The expressions 'O/B' and 'C/O' on carriage documents
The Hong Kong Association of Freight Forwarding and Logistics Ltd (HAFFA) provides a number of interesting 'Recommended Practices' on its website. BP007, while only accessible to HAFFA Members, examines the expressions 'O/B' and 'C/O' which are sometimes used in the 'shipper' or 'consignee' boxes on the front of carriage documents. BP007 explains that customers from Mainland China, who do not have a presence in Hong Kong to organise or handle their exports or imports through Hong Kong, ask Hong Kong forwarders to 'lend their names' for use in the 'shipper' or 'consignee' box of the relevant bill of ladingor sea waybill.
Meaning of 'O/B' in shipping
According to BP007, the expression 'o/b' (eg. ABC Forwarder o/b China Trading) is the short form of 'on behalf of'', which indicates that 'ABC Forwarder' acts as agent of 'China Trading', ie. the expression 'O/B' is not likely to make 'ABC Forwarder' the consignee under the bill of lading or sea waybill. However, BP007 then explains that the expression 'O/B' in the consignee box might suggest that 'ABC Forwarder' has (apparent) authority to receive the goods for 'China Trading', his principal. In any case, BP007 recommends that the carrier demands clear evidence that 'China Trading' authorised 'ABC Forwarder' and equally that 'ABC Forwarder' would be well advised to obtain such clear evidence.
Meaning of 'C/O' in shipping
Conversely, the expression 'c/o' (eg. China Trading c/o ABC Forwarder) stands for 'care of'', which is generally used for addressing correspondence through an intermediary, in which case 'ABC Forwarder' acts on behalf of 'China Trading' for the limited purpose of receiving and passing on correspondence. With regard to release of cargo, BP007 again recommends that the carrier demands production of a written authorisation (or other satisfactory evidence) which shows that 'China Trading' authorised 'ABC Forwarder' to take delivery of the goods. However, BP007 warns that a carrier could argue that 'C/O' has the 'wider' meaning of 'in the care of' or 'in the charge of', in which case it might justifiably deliver the goods to 'ABC Forwarder'.
Conclusion
BP007 provides welcome guidance. It appears to indicate that both 'O/B' and 'C/O' might have more than one meaning. Clearly, as BP007 emphasised, ascertaining the meaning of 'O/B' and 'C/O' requires consideration of all relevant documents and surrounding circ*mstances.
One problem for a forwarder or transport operatorwho accepts the expressions 'O/B' or 'C/O' on their carriage document is that, while 'O/B' or 'C/O' might designate an agency contract between the two named parties, the nature or scope of this agency contract may be unclear. Arguably, the expressions 'O/B' and 'C/O' add another dimension to the already rather complex topic of cargo delivery. The Club therefore advises its Members to undertake due diligenceto verify roles and responsibilities and avoid using the expressions 'O/B' and 'C/O' whenever this is commercially viable.
Apart from complicating delivery, 'O/B' and 'C/O' might also obscure which party is entitled to sue under the carriage document, although in Freight Systems Ltd v Korea Shipping Corporation (1988) the Hong Kong High Court held that 'Freight Systems Ltd o/b Marianne Trading Ltd' meant that Freight Systems were acting clearly as agents and therefore could not sue for an alleged breach of bill of lading terms.
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We hope that you have found the above interesting. If you would like further information, or have any comments, please email us, or take this opportunity to forward to any colleagues who you may feel would be interested.
We look forward to hearing from you.
Peregrine Storrs-Fox
Risk Management Director, TT Club
Peregrine Storrs-Fox
Risk Management Director
Date20/07/2008
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Forwarders Cargo Cover: This is an insurance product designed for freight forwarders, providing coverage for potential risks and losses during the transportation of cargo on behalf of shippers.
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Ports & Terminals Cover: Insurance coverage for ports and terminals, safeguarding against risks related to operations, infrastructure, and potential liabilities arising in these locations.
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Ship Operators Cover: Insurance for companies operating ships, protecting them from various risks such as accidents, damages, or third-party liabilities.
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Claims Management: The process of handling and managing insurance claims, ensuring efficient and fair resolution of disputes or losses covered by insurance policies.
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Underwriting: The process of evaluating and determining the risk associated with insuring a particular entity or activity and setting the terms and conditions of the insurance policy.
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Grain Cargo Handling Facilities Cover: Specialized insurance coverage for facilities involved in the handling of grain cargo, addressing specific risks and challenges associated with the storage and transportation of grain.
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Loss Prevention: Strategies and measures implemented to prevent or minimize the occurrence of losses, damages, or accidents in the shipping and logistics industry.
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Cargo Integrity: Ensuring the completeness, safety, and security of cargo throughout the shipping process, from packing to delivery.
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Grain Handling and Transportation: Specialized processes and considerations for the handling and transportation of grain cargo, taking into account the unique characteristics of grain.
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Port & Terminal Safety: Measures and protocols implemented to ensure the safety of operations at ports and terminals, minimizing the risk of accidents or incidents.
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Russia-Ukraine Crisis: A geopolitical event with potential implications for shipping routes, trade, and logistics, requiring risk assessment and management.
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Supply Chain Security: Measures and strategies implemented to secure and protect the integrity of the entire supply chain, including transportation and logistics operations.
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Warehouse Risks: Risks associated with the storage and handling of goods in warehouses, including potential damages, theft, or other incidents.
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