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Difficulty: Very hardCommercial Documents in Foreign Trade

A Nigerian exporter agrees to sell timber to a European buyer under terms where ownership of the goods must be legally transferable to a third party while the consignment is still at sea. Which commercial document acts as a quasi-negotiable document of title that enables this transfer of ownership via endorsement and delivery?

  1. Bill of LadingAnswer
  2. B
    Certificate of Origin
  3. C
    Consignment Note
  4. D
    Mate's Receipt

Answer

Bill of Lading
A Bill of Lading is a document of title issued by a shipowner or shipping line acknowledging receipt of cargo for sea carriage. It entitles the holder to claim delivery of the goods at the destination port and permits the owner to transfer title to a third party while in transit through simple endorsement and delivery.

Step-by-Step Solution

1
Identify the key functional requirement described in the export scenario.
The document required must serve as a negotiable document of title capable of transferring ownership of cargo while at sea via endorsement.
Only documents of title grant legal ownership rights over goods in transit.
2
Compare the legal status of international shipping and trade documents.
The Bill of Lading serves three main functions: receipt of cargo, contract of carriage, and a document of title. Neither the Certificate of Origin, Consignment Note, nor Mate's Receipt acts as a document of title.
A Bill of Lading allows transfer of title by endorsement to a endorsement recipient while cargo is afloat.

Key Concept

Bill of Lading as a Document of Title in Foreign Trade
Estimated Time:1m 30s
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Topics

Commercial Documents in Foreign Trade

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