Charter Party Bill of Lading Acceptable Under UCP 600 Article 20

Introduction

A charter party bill of lading is a bill of lading issued subject to a charter party. UCP 600 Article 20(a)(vi) requires the bill of lading to contain no indication that it is subject to a charter party. A bill of lading that indicates it is subject to a charter party is not acceptable under Article 20. The acceptable alternative is Article 22, which governs charter party bills of lading specifically. This guide addresses the distinction between Article 20 and Article 22 bills of lading, where charter party indications create risk, and how to resolve the common failures.

Failure Mode Analysis

Failure Mode 1: Bill of lading contains "subject to charter party" clause

The bill of lading contains a clause such as "subject to charter party dated [date]" or "all terms and conditions as per charter party." Article 20(a)(vi) prohibits any indication that the bill of lading is subject to a charter party. The presence of this clause makes the bill of lading discrepant under Article 20.

Failure Mode 2: Credit requires clean B/L but presents charter party B/L

The credit requires a "clean, on-board bill of lading." The beneficiary presents a charter party bill of lading. The document does not satisfy the credit requirement because Article 20(a)(vi) excludes charter party bills of lading.

Failure Mode 3: Charter party reference on reverse side

The charter party clause appears on the reverse side of the bill of lading. Article 20(a)(v) permits the bill of lading to contain terms and conditions of carriage or make reference to another source. However, Article 20(a)(vi) specifically excludes any indication of a charter party, regardless of where it appears.

Failure Mode 4: Credit silent on charter party but B/L subject to one

The credit is silent on whether a charter party bill of lading is acceptable. The beneficiary presents a bill of lading subject to a charter party. The credit does not call for a charter party bill of lading, so Article 22 does not apply. The bill of lading must comply with Article 20, which excludes charter party indications.

Failure Mode 5: Mixed charter party and non-charter party B/L

The bill of lading contains a partial reference to a charter party—for example, "subject to charter party for the port-to-port leg only." Article 20(a)(vi) does not distinguish between full and partial charter party references. Any indication that the bill of lading is subject to a charter party is a discrepancy.

Deterministic Resolution Architecture

1. Read the credit's transport-document requirement. Does it require a bill of lading (Article 20) or a charter party bill of lading (Article 22)?
2. If the credit requires a bill of lading under Article 20, confirm the document contains no indication of a charter party.
3. Examine the front and reverse side of the bill of lading for any charter party reference, clause, or notation.
4. If the credit requires a charter party bill of lading, present a document under Article 22 with the required charter party reference.
5. If the credit is silent on charter party, assume Article 20 applies and no charter party indication is acceptable.
6. If a charter party reference is discovered, obtain a clean bill of lading without the reference before presentation.
7. Do not assume the bank will overlook a charter party clause on the reverse side. The examiner reads the complete document.
8. Confirm the bill of lading type matches the credit requirement before presentation.

Conclusion

Article 20 and Article 22 are mutually exclusive transport-document regimes. A bill of lading subject to a charter party does not satisfy Article 20. It satisfies Article 22 only when the credit expressly calls for a charter party bill of lading. The presence of any charter party indication on a bill of lading presented under Article 20 is a discrepancy. Pre-presentation examination of the complete document—front and reverse—prevents this failure.

FAQ

Can a bill of lading reference a charter party on the reverse side without being discrepant?
No. Article 20(a)(vi) excludes any indication that the bill of lading is subject to a charter party, regardless of where the indication appears.

What if the credit requires a "bill of lading" but the goods are shipped under charter?
The beneficiary must obtain a bill of lading that does not indicate it is subject to the charter party. The carrier or agent can issue a clean bill of lading without the charter party reference.

Is a "sea waybill" subject to a charter party treated differently?
A sea waybill is governed by Article 21, not Article 20. Article 21 does not contain a charter party exclusion. However, a sea waybill is a different document type and must satisfy its own requirements.

Can the credit prohibit charter party bills of lading?
The credit may state that charter party bills of lading are not acceptable. Under ISBP 745, such a stipulation has no specific meaning unless the credit provides additional requirements. In practice, the prohibition reinforces that Article 20 applies.

What if the charter party reference is inadvertent?
The examiner does not assess intent. The presence of the charter party indication on the document is a discrepancy under Article 20(a)(vi), regardless of whether the reference was intentional.

Source Notes

• Canonical authority: UCP 600 Articles 20, 22; ISBP 745 paragraphs E1, G2.
• Live context: Google News RSS scan, ICC Academy "Certified UCP 600 Specialist (CUCP)," July 2025; ICC "Commentary on UCP 600," August 2019. Context only, not legal authority.