Policy & Compliance
contact with either its agent or consignee at destination, and have a process to monitor clearance and removal from the quay. The last consideration is to Mitigating the risk of abandoned cargo Members should take steps early in the process to minimise their exposure to the costs of abandoned cargo. Prevention is better than cure
have processes in place to deal with unclaimed cargo at the earliest possible stage and minimise any costs. BIFA, whilst conducting its review of the Standard Trading Conditions (STC), has been considering issues facing its Members in this respect and, consequently, the 2025 edition of the STC will increase the rights of the Member to dispose of goods that are incurring quay rent and demurrage. Communication This right is subject to the Member maintaining good communication and drawing to the customer’s attention its intention to dispose of the cargo before doing so. Clause 10 of the
The TT Club has allowed BIFA to
share its flow chart highlighting steps that should be taken to reduce the risk of abandoned cargo (pictured on page 19). This can be a significant issue for Members; the largest sum we have been advised of is a bill for $800,000 for containers abandoned in Vietnam. We regularly receive enquiries from Members who have a received an invoice for $50,000 or more. The key points from the TT Club guidance is to “Know your customer” and to
carefully consider risks associated with both the cargo and destination. Overlooked clause Members, when booking cargo with a carrier, often overlook the implications of the Merchant Clause included in the bill of lading terms. These broadly define who is considered a ‘Merchant’ and therefore liable for various obligations related to the shipment, indemnification of the carrier. It typically encompasses the shipper, receiver, consignee, the booking party and anyone holding, or entitled to, possession of the goods or the bill itself. The last two mentioned parties include freight forwarders, who often show themselves as shipper on a ‘back- to-back’ bill of lading. This clause ensures that the carrier has recourse for financial obligations and potential liabilities arising from including freight, charges, demurrage and potential
the shipment. A typical Merchant Clause definition is broad, often including a phrase similar to “The merchant includes the shipper, holder, consignee, receiver of the goods, any person owning or entitled to the possession of the goods, or of this bill of lading, and anyone acting on behalf of any such person”. Other such clauses specifically mention the ‘booking party’. Quite clearly the freight forwarder falls within the definition of ‘merchant’. The TT Club is quite correct to emphasise that all parties need to be clearly aware of their responsibilities and financial obligations. In certain ways the trickiest term to deal with is ‘ex- works’ because of the limited responsibilities of the seller in these circumstances. Additionally, the TT Club highlights the need for the freight forwarder at origin to maintain
2025 STC has been reinforced to read: “All costs incurred by the Company (BIFA Member) as a result of the failure to take delivery shall be deemed as freight earned, and such costs shall, upon demand, be paid by the Customer or Owner.” To conclude, prevention is better than cure and Members can take steps early in the process to minimise their exposure. The next stages are for Members to have processes in place to monitor the removal of the cargo from the quay/dockside and to ensure that unclaimed/unwanted cargo is removed from the quay as early as possible. There will always be issues with unclaimed/ abandoned cargo so it is essential that Members can understand and have processes to deal with this issue. BIFA would like to thank the TT Club for allowing the reproduction of its flow chart.
“ Members, when booking cargo with a carrier, often overlook the implications of the Merchant Clause included in the bill of lading terms
20 | September 2025
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