On February 26, 2009, the Supreme People’s Court (SPC) issued the Provisions on Several Issues Concerning the Application of Law in the Trial of Cases Involving the Delivery of Goods without the Original Bill of Lading which took effect on March 5, 2009. Before the issuance of the Provisions, there were no separate rules or regulations in China that dealt specifically with bills of lading, and though certain sections of the Maritime Code of the PRC (the Maritime Code) touched upon bills of lading, these sections were relatively vague and confusing. Consequently, the number of disputes involving the delivery of goods without the original bill of lading was continually growing. The Provisions aim to provide courts with clearer direction in resolving these disputes.  

The Provisions apply to cases in which the holder of an original bill of lading (including a straight bill of lading, an order bill of lading and a bearer bill of lading) (the Holder) sustains damages due to a carrier’s delivery of the goods without the original bill of lading (the Carrier). In such cases, the Holder may require the Carrier to bear the losses suffered from the undue delivery. Moreover, if a third party takes possession of the goods with a forged bill of lading (a Third Party), the Holder may also demand that the Carrier assume relevant civil liabilities.  

Under the circumstances above, the Holder may choose to hold the Carrier liable for breach of contract or various torts. Damages may be calculated on the basis of the value of the goods at the time of shipment plus freight and insurance costs. Meanwhile, the Carrier is not entitled to limitation of civil liability under Article 56 of the Maritime Code.  

With respect to litigation rights, the Holder may demand the Carrier and the Third Party to assume joint and several liabilities. If the Holder reaches an agreement with the Third Party regarding payment for the goods, but the amount payable under the agreement is not compensated, this does not affect the right of the Holder to hold the Carrier liable for the losses it suffered. The statute of limitation for such cases is one year, starting from the date on which the goods were due for delivery by the Carrier.  

The previous lack of specific regulations governing bills of lading and the general terms of the Maritime Code complicated the application of law in cases involving bills of lading. The promulgation of the Provisions, which provide specific directions for such cases, should facilitate the administration of relevant disputes.