The International Maritime Bureau (IMB) announced that it has launched a new initiative aiming to mitigate bills of lading (B/L) fraud conducted by non-vessel owning common carriers (NVOCCs). The IMB NVOCC Register provides a business solution to a business problem impacting parties involved in international shipping and trade.
B/Ls are important documents in which many stakeholders in the trading chain rely including banks, shipping companies, carriers and charterers. IMB now says that while the vast majority of NVOCCs issue B/Ls correctly, there is a small minority that do not.
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This could cause fraudulent practices, and banks that unwittingly process false B/Ls could discover that either there are no cargoes underlying the documents or that the shipments may be misrepresented.
IMB also added that up to 95% of the false B/Ls identified by the Bureau are issued by NVOCCs. Speaking about this development, an IMB spokesman said that:
Incidents of ship owners/carriers or their agents issuing false B/Ls are uncommon because they take a big risk in doing so and open themselves to legal action. However, unlike the carriers or their agents, the majority of NVOCCs do not have any assets which are at risk in these transactions except for their reputations
IMB now called NVOCCs to sign up to its NVOCC Register. If they do that, they will be able to sign up to a Code of Conduct for the issuance of B/Ls. In case they fail to comply with the Code of Conduct, the NVOCC may be removed from the Register in certain instances.
As IMB explained, the intention is not to exclude defaulting NVOCCs, but to help them improve the steps taken to issue bills of lading which is relied upon by a number of other stakeholders.
Finally, an advantage of signing up to the Register is that banks may process the documents of NVOCCs on the Register faster than those that are not.
