NVOCC register created and minimum standards set for the
Issuance of NVOCC Bills of Lading
FMC defines NVOCC – Non-Vessel-Operating Common Carrier as:
- A common carrier that holds itself out to the public to provide ocean transportation, issues its own house bill of lading or equivalent document and does not operate the vessels by which ocean transportation is provided
- A shipper in its relationship with the vessel-operating common carrier involved in the movement of cargo
As there is no global regulatory body to register, control or regulate NVOCCs around the world, it is difficult to see how many NVOCCs are currently in operation around the world or where they are based..
- It is widely believed that the US market has the largest number of NVOCC operators in the world.. USA may also be one of the few countries where an NVOCC needs to be registered prior to offering services..
- NVOCC registration is also required in China as per certain publications which say that the operator must be registered with Ministry of Transportation..
- Not just in terms of their registration, but there doesn’t seem to be a clear definition on whether the NVOCC operator needs to register their bill of lading or not..
- Similarly, the requirement or need for registration of an NVOCC in other major jurisdictions is clear as mud..
What is the function of an NVOCC..??
An NVOCC is often termed as a “carrier to shippers” and “shipper to carriers”.. What does this mean..??
At the most basic level, an NVOCC enters into volume-based ocean freight arrangements with the various shipping lines operating across the various trade lanes.. An NVOCC then creates their own tariff based on which they sell space on these liner services to their various clients..
Depending on certain jurisdictions and markets, NVOCC’s activities may include but not restricted to below :
Ok, now to the subject of this post..
The ICC International Maritime Bureau (IMB) estimates from its work in verifying Bills of Lading that over 95% of all improperly issued Bills of Lading are issued by – yeah you guessed it – Non-Vessel Operating Common Carriers (NVOCCs)..
The IMB identified that there is a prevalence of issuance of incorrect NVOCC bills of lading by the NVOCC which is then presented to banks and other stakeholders in the trading and finance chain, with the aim of defrauding the trade finance system, possibly for the purposes of multiple financing, money laundering, etc..
The IMB has developed a business solution to mitigate the effects of this problem..
The IMB has established a register for Non Vessel Operating Common Carriers (the Register) who agree to abide by the IMB Code of Conduct for the proper issuance of NVOCC Bills of Lading..
The purpose of the Register is to improve anti-fraud standards and provide a mechanism to recognise participating NVOCCs who adhere to a minimum standard of anti-fraud measures in their operations..
Banks who are members of the IMB can now check whether the NVOCC named on the bill of lading presented to them has signed up to the IMB Code of Conduct..
This provides some sort of assurance to the banks and customers that the NVOCC bills of lading issued by these NVOCCs meet acceptable standards.. There are of course consequences for NVOCCs who fail to comply..
TT Club noted that in terms of banking scrutiny, The International Chamber of Commerce’s Commercial Crime Services division has a primary function of protecting the integrity of international trade by seeking out fraud and malpractice and providing reports based on this activity to its members..
Commercial banks conduct thousands of investigations each year in relation to fraudulent bills of lading and these investigations are undertaken by the IMB..
As part of the investigation process, IMB conducts due diligence on all trade documents, including bills of lading, and seeks independent third-party verification to provide an extra level of confidence in transactions..
Safeguard against shipping and freight fraudThis supports banks in relation to their compliance procedures to prevent fraud, money laundering and sanctions breaches, especially since banks are not obligated or have no resources to verify if the goods have been shipped on board..
Suspect bills of lading are those which have false content including the wrong ship, dates, description of cargoes, container numbers or parties..
Perpetrators present such bills of lading to banks to facilitate fraudulent activity including money laundering, fraud, illegal capital flight and to by-pass sanctions..
Shipping and Freight Resource fully supports this initiative of the IMB which sets out the standards for the issuance of NVOCC bills of lading, and also the fact that there will now be a register where NVOCCs can be tracked..
What is your opinion on this initiative..??
This is hugely beneficial to the shipping and freight industry and will surely reduce potential exposures to fraudulent activity throughout the supply chain..
Hopefully, in due course, this will become a regulatory requirement for NVOCCs and maybe even Freight Forwarders, much like a customs broker or clearing agent licence.
PS: As a point of interest, only the ICC and IMB seems to be expanding NVOCC as Non-Vessel Owning Common Carrier whereas everyone else including FMC, World Shipping Council, TT Club seems to expanding NVOCC as Non-Vessel Operating Common Carrier..
Although it could mean both Owning or Operating, would be interesting to hear the rationale.
I am text block. Click edit button to change this text. Lorem ipsum dolor sit amet, consectetur adipiscing elit. Ut elit tellus, luctus nec ullamcorper mattis, pulvinar dapibus leo. I am text block.
Helpful directory resource connected to residential window repair. Good for comparing local service providers.
Helpful business listing featuring a Charlotte window repair company. Useful for researching local repair specialists.
The official True Fortune website brings hundreds of games together on a single, easy-to-use platform.
True Fortune offers an extensive range of slots covering every theme and volatility level.
True Fortune greets new users in the United Kingdom with a welcome package that boosts the first deposit.
The casino accepts a range of payment options familiar to players in the United Kingdom.
True Fortune promotes responsible gaming with limits, time-outs and support links.
New users can check the FAQ for quick guidance on bonuses and payments.
true fortune bonus true fortune bonus
The site combines a huge game library with a clean, modern interface.
Players can choose from a vast slot collection powered by top studios such as Microgaming and Yggdrasil.
The promotions page lists reload bonuses, tournaments and cashback offers.
Verified players enjoy speedy payouts through their preferred method.
Players in the United Kingdom can use built-in tools to keep their gambling under control.
A 24/7 support team helps players in the United Kingdom through live chat and email.
true fortune free spins true fortune free spins
Helpful article covering window repair topics in Charlotte. A useful reference for homeowners comparing services.
Helpful directory listing related to broken window repair services. Useful for researching repair options.
The casino welcomes players from the United Kingdom with a localised experience and responsive support.
The live casino section brings authentic tables with professional dealers straight to any device.
New players in the United Kingdom can claim a generous welcome bonus with free spins on their first deposit.
true fortune casino free spins no deposit true fortune casino free spins no deposit
Minimum deposits are low, making it easy to get started.
Fair play is guaranteed by independently tested RNG games with published RTP rates.
A detailed FAQ and clear terms make it easy for players in the United Kingdom to find answers fast.
Designed with players in the United Kingdom in mind, the site keeps registration and play simple.
The live casino section brings authentic tables with professional dealers straight to any device.
A welcome offer with matched bonus funds and free spins awaits new players in the United Kingdom.
True Fortune supports popular payment methods including Visa, Mastercard and e-wallets like Skrill and Neteller.
The casino is licensed and applies strong security to keep accounts and funds safe.
The mobile casino runs smoothly in any browser with no download required.
true fortune free chip true fortune free chip
Useful directory listing covering home window repair in Charlotte. Helpful for finding reliable repair companies.
Helpful business profile featuring a trusted Charlotte window repair company. Good for comparing local contractors.