UCP 600 Article 22: Charter Party Bill of Lading — Complete Interpretation Guide

Introduction

Article 22 of UCP 600 provides a comprehensive framework for the examination of charter party bills of lading presented under documentary credits. This complete interpretation guide covers every sub-article, explains how charter party bills of lading differ from standard bills of lading under Article 20, and provides practical guidance for compliance. Charter party bills of lading are common in bulk cargo and tanker trades, making Article 22 an important provision for practitioners in these sectors.

Failure Mode Analysis

Failure Mode 1: Submitting a Standard Bill of Lading Under Article 22

Risk: The credit requires a charter party bill of lading (Article 22), but the presenter submits a standard bill of lading (Article 20) that does not indicate a charter party.

Impact: The document type is wrong. A standard bill of lading does not satisfy a charter party bill of lading requirement.

Failure Mode 2: Charter Party Reference Too Vague

Risk: The bill of lading contains a vague reference to a charter party without clearly indicating it is subject to the charter party terms.

Impact: Article 22(a) requires a clear indication that the bill of lading is subject to a charter party. Vague references may not satisfy this requirement.

Failure Mode 3: Missing On Board Notation

Risk: The charter party bill of lading does not contain an on board notation, relying instead on the charter party terms to evidence shipment.

Impact: Article 22(c) requires the on board notation. The charter party terms do not substitute for this requirement.

Failure Mode 4: Port Names from Charter Party Differ from Credit

Risk: The charter party specifies different ports than the credit. The bill of lading uses the charter party ports.

Impact: Article 22(b)(iii) and (iv) require the ports as stipulated in the credit. The charter party ports do not override the credit requirements.

Failure Mode 5: Missing Shipper Name

Risk: The charter party bill of lading does not identify the shipper by name.

Impact: Article 22(b)(i) requires the name of the shipper. A missing shipper name is a discrepancy.

Failure Mode 6: Incomplete Original Set

Risk: The bill of lading states "issued in three originals" but only two originals are presented.

Impact: Article 22(a) requires the full set when issued in more than one original.

Deterministic Resolution Architecture

Resolution 1: Document Type Verification

Before submission:
1. Verify the credit requires a charter party bill of lading
2. Confirm the bill of lading indicates it is subject to a charter party
3. Do not submit a standard bill of lading when a charter party bill of lading is required

Resolution 2: Charter Party Indication Confirmation

Verify the bill of lading contains a clear indication:
- "Subject to charter party"
- "Freight payable per charter party"
- Reference to a specific charter party agreement
- Any clear language indicating the charter party arrangement

Resolution 3: Content Verification

Verify all Article 22(b) elements:
1. Shipper name
2. On board notation
3. Port of loading
4. Port of discharge
5. Original marking
6. Date of issue
7. Contract of carriage evidence

Resolution 4: Port Matching

Match the ports against the credit:
- Use exact port names as stipulated
- Do not rely on charter party port names if they differ
- Confirm both port of loading and port of discharge

Resolution 5: On Board Notation Verification

Confirm the on board notation:
- Contains "on board" or "loaded on board"
- Is signed or initialled
- Is dated
- Identifies vessel and port of loading

Resolution 6: Charter Party Terms Review

Review the charter party terms:
- Confirm the charter party is valid
- Verify the terms do not conflict with the credit
- Note any unusual terms

Resolution 7: Bank Examination Protocol

When examining a charter party bill of lading:
1. Confirm it indicates it is subject to a charter party
2. Verify all mandatory content
3. Check the on board notation
4. Match ports against the credit
5. Verify the original or full set is presented
6. Review the charter party reference

Conclusion

Article 22 provides a comprehensive framework for charter party bills of lading under UCP 600. The key distinction from Article 20 is that charter party bills of lading must indicate they are subject to a charter party. They must meet all content requirements including shipper identification, on board notation, and port specifications. Understanding these requirements ensures compliance and prevents confusion with standard bills of lading.

Frequently Asked Questions

1. What is a charter party bill of lading?

A charter party bill of lading is a bill of lading issued for goods shipped on a chartered vessel. It indicates that it is subject to the terms of a charter party agreement between the shipowner and the charterer.

2. Can a credit require a charter party bill of lading?

Yes. The credit may specifically require a charter party bill of lading under Article 22. If the credit requires a "bill of lading" without specifying "charter party," Article 20 applies.

3. Does the charter party need to be presented with the bill of lading?

No. UCP 600 does not require the charter party to be presented. The bill of lading must indicate it is subject to a charter party, but the charter party document itself is not required.

4. What if the charter party terms conflict with the credit?

The credit terms prevail. The bill of lading must comply with the credit requirements regardless of the charter party terms.

5. Can a freight forwarder issue a charter party bill of lading?

Yes, provided the freight forwarder identifies itself as carrier or as agent of a named carrier (Article 22(d)).

Source Notes

Context only. This guide is based on UCP 600 Article 22 (ICC Publication No. 600), ISBP 745 (ICC Publication No. 745), and eUCP Version 2.1. Source references in the search results pointed to general ICC Academy and UCP 600 e-book pages, which provided contextual framing but not article-specific text.