Introduction

The business sector “Shipping Guarantee” (abbreviation SG) covers all transactions directly connected to the processing of shipping guarantees.

The bank issues a Shipping Guarantee on behalf of the importer in favour of the freight carrier in case the merchandise shipped by sea arrives at its destination earlier than the documents. Early receipt of the goods means that the importer saves storage costs; in return, however, the importer commits to take up the documents as soon as they arrive.

Processing of a release of goods with a shipping guarantee:

• The importer submits an order to the bank for the issuance of a shipping guarantee and simultaneously commits himself to take up the documents, irrespective of the discrepancies they happen to contain.
• The bank issues a shipping guarantee to the freight carrier. Both processes take place in the transaction “Opening a Shipping Guarantee”.
• When the original documents arrive at the bank, the documentary value is debited to the importer. If a shipping guarantee has been issued, the latter will be reclaimed by the freight carrier in exchange for the original bills of lading. The surrender of the transport documents and the reclaiming of the shipping guarantee occur as part of the transaction “Send, Accept and Settle Documents”.
• On receipt of the original, the bank will reverse the liability entry and run the Closing transaction.
• In the rare case of utilization, the transaction “Utilize Shipping Guarantee” is available.

Shipping Guarantees may be issued in connection with an import L/C (LI), sets of documents under an import L/C (BR) but also on a stand-alone basis.

A shipping guarantee tied to an import L/C is displayed in the business transactions relating to the L/C and also in all documentary presentations under this L/C. A shipping guarantee assigned to a specific set of documents is only displayed in the set of documents assigned. To display the data of the linked shipping guarantees, a separate “Shipping Guarantee” panel is available in the business sectors Import L/Cs and sets of documents under an import L/C. Moreover, the amounts of the shipping guarantees are also available within the liability.