Documents handled by ship agents

One of the prime responsibilities in a ship agency is to handle documents for and on behalf of their principals. These documents serve a specific purpose and are so important in nature that vessel loading, discharging, releasing of cargo from port premise depends on proper uses of same.

Proper documentation is not only essential for routine operations but also required for compliance, operational efficiency, risk management, and transparent financial transactions. Proper record-keeping, accountability, and smooth communication between stakeholders, optimizing maritime operations and minimizing potential liabilities are some of the important purposes these documents serve. 

Some of these important documents handled by ship agents are Notice of Readiness (NOR), statements of fact (SOFs), Mats receipt, Bill of Lading, Letters of indemnity (LOI), letters of protest (LOP), cargo manifests, Cargo Documents, and stowage plans. These documents are crucial for recording vessel activities, indemnifying against certain risks, protesting disputes, documenting cargo, and planning cargo stowage, ensuring smooth port operations and regulatory compliance. 

In this blog we are going to understand functioning and importance of all these documents in detail for education and knowledge sharing purposes: -

1.NOR

• The Notice of Readiness (NOR) is a critical document in tanker and dry cargo vessel charter parties, signaling the vessel's readiness to load or discharge cargo. Typically, it can be tendered upon arrival at the pilot station or anchorage, with a countdown of laytime starting six hours after arrival, day or night. Terms in charter parties specify when NOR can be tendered, such as "WIBON" or "WIPON." Agents must promptly confirm the vessel's arrival and pass the NOR to the correct party to avoid laytime delays. Although legally NOR can be oral, charter parties usually require written notice. The NOR initiates the laytime process, crucial for charter party compliance and efficient cargo operations.
•  NOR to be tendered as per agreed C/P 
• Normally it is within office hours (Dry cargo vessel)
• Agents need to be very careful and timely obtain official confirmation of vessel’s arrival. Agents to pass the NOR to correct party without delay. Failure to do this will result in laytime beginning later
• Golden rule, in case of doubt, is for the Master to tender NOR, where the delay is caused by reasons beyond the ship’s control
• Extremely important: Notify the charterers of a vessel of its readiness to load or discharge cargo

2.SOFs

• The Statement of Facts (SOFs) - The SOF provides vital information needed in order to calculate the Laytime. It is actually the mirror of all the facts that took place during vessels stay in a port.

No matter which form may be used, the Statement of Fact would include information such as:

1. Date and time of commencement and completion of loading or discharging operations
2. Details of daily working time
3. Strikes or lock-outs
4. Holidays and days free of work (Friday, Saturday or Sunday)
5. Shifting between the berths, but also time used from anchorage to load/discharge berth
6. Bad weather (rains, strong winds)
7. Any surveys which interrupt the cargo operations

• The Statement of Facts is signed by the representative of the Shipper or Receiver, the Master and the Agent and is the basis document from which the time sheet is prepared.

Why is it important to make a good Statement of Facts?

• It gives to all parties concerned the breakdown of all facts that happens during port call
• It helps to make a laytime statement and complete the voyage calculation.
• If we make a good/complete Statement of Facts, we simplify others’ work
• It is an official document and in case of any disputes, becomes an evidence in the court

3.Bill of Lading 

• An evidence of, the contract of carriage between the shipper and the carrier whereby for an agreed freight, the carrier undertakes to carry the shipper’s goods to their destination.
• A document of title which entitles the holder to take possession of the goods loaded aboard the vessel from the carrier. Transfer of a Bill of Lading amounts to symbolic delivery of the goods. Once transferred, the party in possession of the Bill of Lading can claim the goods when these arrive at the port of destination.
• A receipt for the goods, issued by the carrier. In fact, it is a receipt certifying three separate qualities: (a) the quantity or volume of the goods; (b) the leading marks on the goods; and (c) whether or not the goods were shipped in apparently good order and condition.

A Bill of Lading provides information on

• Description of goods
• Conditions of goods
• Quantity of goods
• Loading port and date of shipment
• Discharge port
• Name of the ship
• Whether freight has been paid
• Terms of carriage
• Delivery instructions

Commonly used words of description in Bill of Lading

weighty, measure,

quantity, condition, 

content and value unknown”

“shipper’s load and content”

“apparent order and condition”         

“said to be”

”said to weight”

4.Mate’s receipt 

• Mate’s receipt is a document issued by vessel’s Master/ Chief Officer or his authorized agent.
• The documents are evidence for receipt of a shipment onboard the vessel
• The mate’s receipt is issued to the shipper to prepare the bill of lading. It is returned to the ship in exchange for a signed bill of lading. In the event of any inaccuracies in the shipper’s description of the goods (quantity, quality, damages, etc.), the Mate’s receipt should be clause accordingly before signing by the Master/Chief officer.
• In the event that the BL's cannot be issued prior to the vessel’s departure, the agent may issue the BL's after the vessels departure in strict compliance with the Mate's receipt and masters authorization for issuing Bills of Lading on his behalf.

5.Letter of Indemnity (LOI)

• Letters of Indemnity (LOI) are commonly used in the cases where the Original Bill of Lading is not available in the Port of Discharge or when the Port of Discharge is changed.
• Cargo interests or the charterer may in such cases offer a Letter of Indemnity in exchange for delivering the cargo without production of an original Bill of Lading or for delivering the cargo to a destination not named in the Bill of Lading.
• It should be noted that neither the principal nor the carrier has insurance for the consequences of delivery of the cargo without surrendering of the Original Bill of Lading in exchange, or delivery at a port other than the port stated in the Bill of Lading.
• An Indemnity given in a Letter of Indemnity is not an insurance, and it is
• only as good as the party issuing it.
• A LOI promising to indemnify the Company in respect of any liability incurred under the Bill of Lading as a result of the incorrect/ inaccurate information entered in the Bill of Lading is regarded as fraud. This includes LOIs offered in exchange for issuing a Clean Bill of Lading or for a Bill of Lading which is ante- or post-dated.

6.Letter of Protest (LOP)

• A Letter of Protest is a written declaration that is intended to record complaints concerning any operational matter that is performed by a recipient or other party.
• It is not a legal document, but simply a report of operations, contractual agreement, that have gone wrong (discrepancy in cargo quantity figures etc…)
• It serves to protect the Master from any blame in the case of mishandling of cargo, delivery of wrong fuel, violation of regulations, berths unclear, equipment that has become inoperative, etc.
• In practice, it can be served by various parties of the vessel when a dispute arises

7.Other Cargo Documents

Other important cargo documents handled by ship agents include:

Pumping Log: A record of the pumping activities during cargo loading or discharge, detailing quantities transferred, pressures, temperatures, and any relevant observations. It ensures accurate documentation of cargo handling operations.

Ullage Reports: Reports documenting the empty space in cargo tanks, typically measured before and after loading or discharge to calculate the exact quantity of cargo onboard. Ullage reports are crucial for monitoring cargo quantities and ensuring compliance with safety and regulatory standards.

Cargo Quality Certificate: A certificate issued by inspectors or surveyors verifying the quality of the cargo being loaded or discharged. It confirms that the cargo meets specified quality standards and is suitable for transport.

Discharge Certificate: A certificate issued upon completion of cargo discharge, confirming that the cargo has been safely and fully unloaded from the vessel. It may include details such as quantities discharged, conditions of the cargo, and any relevant remarks.

Surveyor's Reports: Reports prepared by independent surveyors who inspect cargo, vessels, or equipment to assess their condition, quantity, quality, or compliance with regulations. Surveyor's reports provide impartial assessments and are often required for insurance purposes or dispute resolution.

T2L Customs Declaration: A customs declaration form used within the European Union (EU) to declare the movement of goods between EU member states and non-EU countries. It provides details about the cargo, its origin, destination, value, and other relevant information required for customs clearance.

These cargo documents are essential for ensuring the safe, efficient, and compliant handling of cargo throughout the shipping process, from loading at the port of origin to discharge at the destination port. They facilitate accurate record-keeping, quality control, regulatory compliance, and dispute resolution, benefiting all parties involved in maritime trade.

Conclusion:

In conclusion, the multitude of documents involved in ship agency for vessel handling at ports serves vital functions in ensuring smooth operations and regulatory compliance. From legal obligations to operational efficiency and risk management, each document serves a specific purpose in facilitating the movement of cargo and the safe navigation of vessels. A thorough understanding of these documents is paramount, as it enables stakeholders to navigate complex maritime processes effectively, ultimately contributing to streamlined turnover and enhanced efficiency in port operations.