Can I stop a telex release on a bill of lading after I have requested for it..??

Can I stop a telex release on a bill of lading after I have requested for it..?? This was a question asked by a reader (Harcourt).. A very tricky but interesting question..

Image of a Telex Machine

This is the machine that gave the Telex Release its name.. The great TELEX Machine (similar to your BBM only much bigger and in many ways more capable)

Before we get to the discussion, lets refresh what a TELEX RELEASE is..

As described in my previous article What is a Telex Release :-

“A telex release is simply a message that is sent by the shipping line or agent at load port to their office or agent at discharge port advising that the shipper or exporter has surrendered one or all of the original bills of lading that have been issued to them, and that the cargo can be released to the consignee shown on the bill of lading without presentation of any original bills of lading..”

The process of telex release is

  1. Original bill(s) of lading is issued to the shipper after the sailing of the ship
  2. If shipper requires a Telex Release to be issued for reasons mentioned in the above post, he will surrender all issued Original(s) to the shipping line or agent
  3. Shipping Line/Agent checks that the same bills have been returned
  4. Shipping Line/Agent sends the Telex Release message to the discharge port agent confirming that all Original Bills pertaining to this shipment has been surrendered and the release may be given to the consignee after collection of all charges due as per the manifest

One IMPORTANT POINT TO BE NOTED is that a Telex Release can be issued only on a STRAIGHT BILL OF LADING and never on a NEGOTIABLE/ORDER BILL OF LADING..

In the case of a Straight Bill of Lading the destination agent is allowed to release cargo only after collecting the Original(s) Bill of Lading..

Once a Straight Bill of Lading is surrendered back to the shipping line, should it be considered that the shipper has relinquished the ownership and transferred it to the consignee by virtue of the surrender and Telex Release sent..??

Recalling a Telex Release would then mean that the Original Bill of Lading to be returned to the shipper which would then put the ownership of the cargo back into his hands..??

Image for discussion

 

Taking the above into account should the shipping line/agent agree to recall the Telex Release if the shipper requests it..??

Personally I haven’t come across such a situation, but such an action has its consequences as one can imagine..

Between the time a Telex Release is issued and is recalled, the destination agent could have released the cargo to the consignee by virtue of the Telex Release..

It of course goes without saying that if the release has already been effected at destination, then this request will have no bearing..

What are your comments, thoughts on this one..??

Signing off using a Telex Style ++++

Image Credits :

  • http://www.samhallas.co.uk/museums/henlow – for the Telex Machine
  • http://www.toonsup.com/users/h/hsbcartoon – for the discussion

 

 

What did you think of the above article..?? Comment below..

7 comments on “Can I stop a telex release on a bill of lading after I have requested for it..??

  1. Zuzana Haider says:

    I have a case now, when we ship cargo from Paraguay to Russia and I have made all bookings from USA and arranged with the steam ship line and the shipper, that once shipper will pay his bill and will approve the container release at destination, I will send a note to the steam ship line to telex release the cargo. All is paid now and the shipper wants to wait with the release, to make sure the consignee will pay all in full…. all agreed and I and the steam ship line are waiting for the shipper’s approval to telex release the contianer.
    Suddenly I get a copy of an Original B/L for my shipment from an agent in Paraguay asking shipper, where to send original B/L. How is possible that the steam ship line is releasing originals to some other agent, which didn’t make the booking? This company is probably responsible for the export documentation in Paraguay, but is not responsible for the ocean freight.
    I have called the steam ship line to get back the original B/L, but even though I gave s.s.line clear instructions not to release the cargo without my approval, I am afraid, it might be done without me in control! Thank you.

  2. Emily Ha says:

    Hi Hariesh,

    How do you think about the case when fraudulence is involved? The shipper has arranged Telex Release and the consignee has been informed of this and then makes payment to the shipper accordingly but the consignee hasn’t taken delivery. However, for a certain reason, the shipper approaches the shipping agent for Telex Release cancellation. In this case, is it legal for the shipping agent to accept such request from the shipper? Does the shipping agent need to verify it with the cnee at the same time before dealing with recalling Telex Release?

    1. Hi Emily, once the shipper has asked for the telex release to be issued and the line issues it, then the case is closed.. Shipper should not be allowed to revoke that instruction whether cargo has been released at the destination or not.. Eitherways, it is very important for load port and destination port agent to be in close contact with each other and ensure that there are no ambiguities regarding the whereabouts of the B/L and the status of the telex release..

  3. Martin Baez says:

    Dear Hariesh,

    Allow me to correct certain parts of this article:

    a)
    – Were reads: “If shipper requires a Telex Release to be issued for reasons mentioned in the above post, he will surrender all issued Original(s) to the shipping line or agent”

    Should read:
    “If shipper requires a Telex Release to be issued for reasons mentioned in the above post, he will surrender all issued Original(s) to the shipping line or agent”, duly signed in the back (Terms of Contract section).
    This is very important, as consignee will not be signing the contract of carriage… the shipper must do it.

    b)- Were reads: “One IMPORTANT POINT TO BE NOTED is that a Telex Release can be issued only on a STRAIGHT BILL OF LADING and never on a NEGOTIABLE/ORDER BILL OF LADING..”

    This is actually not correct. If a shipper endorses a “TO ORDER” or “TO ORDER OF SHIPPER” Bill of lading, in favor of a certain entity, then he has transferred the ownership of the cargo to that entity, therefore being able to request a Telex Release in favor of that entity.
    Of course, there may be the case that certain Shipping Lines/Freight Forwarders require additional documentation for this or even reject this kind of procedures, but this will be only to be legally covered of certain situations.

    Now, to the main question:

    – If the shipping line/FF has received the Telex Release and has already provided consignee with a document that states that the cargo is already released to them (i.e. Delivery Order, similar document)… then you can not recall the Telex Release, even if shipper asks it.

    – If the shipping line/FF has received the Telex Release and did not provided consignee of any document stating that the cargo is released to them yet, and then… the shipper asks to recall the Telex Release… then this is possible, and the consignee must be informed to contact shipper to resolve the matter.

    Of course, the shipper then needs present this request in writing (depending on the law of the country and the customs) and to recover the full set of Bills of lading, to be the “owner” of the cargo untill he passes this right to consignee whenever he deems necessary.

    Best Regards,
    Martin Baez.
    Former Documentation Mgr. of a shipping agent/line in Paraguay.

    1. Hi Martin, thanks for your perspectives on this.. I would like to comment as below..

      Point a) – “he will surrender all issued Original(s) to the shipping line or agent”, duly signed in the back (Terms of Contract section). This is very important, as consignee will not be signing the contract of carriage… the shipper must do it”as a Straight Bill is Non-Negotiable/Transferable – an endorsement by the shipper is superfluous..

      Point b) – “If a shipper endorses a “TO ORDER” or “TO ORDER OF SHIPPER” Bill of lading, in favor of a certain entity, then he has transferred the ownership of the cargo to that entity, therefore being able to request a Telex Release in favor of that entity.”the general purpose of issuing a Negotiable or Order bill is for the bill to be transferred to another company and in these cases, I personally have not seen any cases where an Order Bill is surrendered for Telex Release as an order bill maybe transferred multiple times..

      Your point reg the main question noted and agree..

  4. j.s.dhillon , Hong Kong says:

    It depends on the delivery agents at the destination to co-operate with you
    In case they have already delivered the cargos to the buyers then it will
    be difficult for them to amend your instructions. If they have not yet
    delivered the cargos then they may co-operate with you and follow your
    new instructions. So first find out the status of the cargos.

    1. Hi JS, yes I agree that there should be close communication between the load port and destination port agents to ensure that there are no gaps where the cargo could be released while the Telex Release or the recall of it could be in limbo..

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