Comments on: BIS Fries Rice

By: Mike Liberto

Mike Liberto — Fri, 31 Oct 2008 16:38:04 +0000

The rules are simple.

Asking another person to particpate in boycott is prohibited. Asking for a certificate from an “agent” could provoke such agent to issue the certificate. It is a reportable request.

The request can be reported as per EAR, and the document issued only by the “owner” (as also suggested by the request) and compliance with law, contract and bank L/C’s can be established.

Happy Exporting

By: Frammi

Frammi — Thu, 30 Oct 2008 21:35:07 +0000

That’s why I’m so glad to be European!

According to European Standards, the clause would have been okay because it is not containing a direct boykott clause.

So American Rice, why don’t you become European Rice
) !!

IMHO the judgement is not just narrow, it’s dumb and violating American interests.

The applicant needs to know that the ship is able to unload in the UAE port and the parties involved in the credit need protection from such costly nonsense.

Of course we cannot allow an Anti-Israeli-boykott by confirming that the ship doesn’t call at Israeli ports. But the used clause seems to be fair – even if the Arab-Liga-boykott itself might not be so.

All the best

Frammi

By: Mike Deal

Mike Deal — Wed, 29 Oct 2008 11:53:24 +0000

OAC makes the distinction on the notion that the agent is being asked to provide information about “another person’s” relationship. In an era when most vessels are separately incorporated, in effect subsidiaries of the owners, ocean carriers who are the beneficial owners of vessels must be careful or they may get caught up in the same net.

By: Clif Burns

Clif Burns — Wed, 29 Oct 2008 11:30:37 +0000

Jim, I don’t have a problem with saying that the language that the vessel can enter all Arabian ports is clearly related to participation in the Arab League boycott against Israel. What troubles me is that the reference to an “agent” in the certificate request created the problem, particularly where the request was for a certificate from the “owner/master or agent”

Worse yet, under agency law a representation from an agent of the owner is a legally-binding representation of the owner and is in all other legal respects completely equivalent to a representation from the owner . . . except, apparently, in Anti-Boycott-Land.

The lesson here is that documents should track 760.5(a)(5) virtually word-for-word; and if they don’t, they should be reported.

By: Jim Dickeson

Jim Dickeson — Wed, 29 Oct 2008 03:43:26 +0000

Narrow, indeed! On the surface, the request does not appear to be exclusionary – excluding a particular country – but rather inclusionary, like a certificate of origin saying that the goods were from a particular country of origin.

On the other hand, it is close enough to warrant further investigation, perhaps calling in legal counsel.

By: Mike Deal

Mike Deal — Tue, 28 Oct 2008 21:12:31 +0000

This pin dance has been around for a quite a spell. Once upon a time, long, long ago, OAC came near to recognizing that ship’s agents perform special functions in maritime law that are broader and more closely connected to the vessel than agents as defined by common law, as in the Restatement. But the old fear of the slippery slope argument ultimately won the day.