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  SWQ_91
1.6.2008		 Goods description
  Question: Name: milton n.

L/C require shipment of “steel tube”

Invoice stipulate shipment of “seamless steel tube”

B/L stipulate shipment of “seamless tube”

Someone stated that according to UCP 600 sub-article 14(e) “In documents other than the commercial invoice, the description of the goods, services or performance, if stated, may be in general terms not conflicting with their description in the credit.¨

Therefore a B/L stipulating shipment of “seamless tube”, which is description of goods in general terms, is not conflicting to the stipulation of the credit.

In my opinion, “tube” under description of goods in the B/L is not the scenario which is mentioned under sub-article 14(e). A description of goods in the B/L stating “metallic tube” or similar, would be the scenario which mentioned under sub-article 14(e).

Moreover “tube” is not sufficient information for us to determine if the description of goods in B/L conflicts with their description in the credit. (“Seamless tube” may also be general term to “Seamless plastic tube”)

Finally some argument stated that “steel tube” is can be interpreted as a general term. Therefore B/L must state the description of goods as “steel tube”.

Best regards

milton n.

 
 
  Answer (from Kim Christensen) Dear Milton,

These cases are really tricky - and it is hard indeed to provide general advice - as it depends highly on a vast number of variables.

The starting point is the goods description in the LC. Going from the goods description in the LC it can basically go two ways:

1) You can detail it further

- which at the outset is okay (see e.g. ICC Opinion R.456)

E.g. if the LC says "20 cars" the invoice (and/or other documents) could say:

20 cars consisting of:

  • 5 blue cars
  • 7 red cars
  • 8 green cars

Or e.g. if the LC says

  • 5 blue cars
  • 7 red cars
  • 8 green cars

Then as per sub-article 18(c) the description of goods in the invoice must correspond with that – but still you can detail it further, like:

  • 5 blue cars, Brand name XXX
  • 7 red cars, Brand name YYY
  • 8 green cars, Brand name ZZZ

That would apply for all documents.

Note also the qualification in ISBP (2007) paragraph 58 to 64 (most relevant in the context of this question is 58 and 59).

When you detail if further (e.g. in the invoice) it is important that you do not change the nature of the goods. ICC Opinion TA.564 includes the following conclusion:

Quote

The description of the goods in the credit reads “Men’s suede jackets, plain suede fabric”. The description in the invoice reads “Men’s suede jackets (imitation suede with 100% polyester knitted backing) plain suede fabric”.

The requirement of UCP sub-Article 37(c) is quite clear i.e. that the description of goods must correspond with that in the credit. The addition of the words “(imitation suede with 100% polyester knitted backing)” is not part of the description of the goods in the credit. The word “imitation” indicates a different category or classification of the goods, which is not apparent in the goods description within the credit. The addition of the word “imitation” is grounds for refusal on the basis that the goods description in the invoice does not correspond with that in the credit.

Unquote

 

 

2) You can make it more general.

E.g. if the LC says:

  • 5 blue cars
  • 7 red cars
  • 8 green cars

Then as per 14(e) other documents than the invoice may show a general description, e.g.

"20 cars"

- but it would also be acceptable if it was identical to the in the invoice – or to the LC.

 

 So to your question:

In my personal view – and it may well be debatable:

If the LC says ”steel tube”

Then the invoice

  1. may detail it further – e.g. ”seamless steel tube” (I do not see any change of the nature of the goods)
  2. but must not make it more general – e.g. ”tube”

The B/L may both

  1. detal it further – e.g. ”seamless steel tube” (I do not see any change of the nature of the goods)
  2. make it more general – e.g. ”tube” (It would not be for the banker to determine wheter ”steel tube” is a general description.

 

All of the above being said – one should still bear in mind UCP 600 sub-article 14(d) which says:

Data in a document, when read in context with the credit, the document itself and international standard banking practice, need not be identical to, but must not conflict with, data in that document, any other stipulated document or the credit.

Meaning that the data (in this case the data describing the goods) must be compared between the documents and the LC.

I hope this helps you

Best regards

Kim