Published 02 August 2007
Circular No. 2/2007 August 2007
To All Members of ASSURANCEFORENINGEN GARD - gjensidig
Dear Sirs,
Paperless Trading – Electronic Shipping Solutions
Members will recollect that the Club issued two circulars dated December 1998 (No. 10/98) and September1999 (12/99) on the subject of paperless trading. The circulars were written at the time of the development of Bolero, which is a scheme which is intended to replace bills of lading and other paper trade documentation by electronic messages.
As described in the circulars, all International Group Clubs introduced a Paperless Trading Endorsement in the 1999 policy year. That endorsement is incorporated in the Member’s certificate of entry. The effect of this endorsement is to exclude liabilities which arise under paperless trading systems such as Bolero which would not arise under conventional paper documentation systems. The Association is able to provide cover for those liabilities which would have arisen if shipments had been made on the basis of conventional documentation.
The International Group has continued to maintain market insurance available for Members participating in Bolero, which provides cover for P&I liabilities excluded from normal Club cover by the Paperless Trading Endorsement.
With effect from 13 April 2007 that cover is also available on the same terms for members who participate in Electronic Shipping Solutions (ESS) paperless system, which functions in a broadly similar way to Bolero.
Members are reminded that this cover is available upon declaration to the Managers. It continues to be important therefore that Members who wish to benefit from the cover advise the Managers before commencing use of Bolero or ESS.
Further details of the Bolero and ESS are available from their websites at www.bolero.net and www.essdocs.com
Members should be aware that the Paperless Trading Endorsement is widely drafted and will, for instance, apply to liabilities (other than those which would in any event have arisen under a conventional paper system) arising from a document containing or evidencing a contract of carriage (e.g. a bill of lading) which is created or transmitted under a paperless system.
The International Group has examined the practice of a carrier electronically transmitting a bill of lading to a shipper, who is then expected to print the bill of lading, and felt that this practice did not constitute use of a paperless system within the scope of the Paperless Trading Endorsement.
Nonetheless, Members who are involved in the electronic transmission of bills of lading are recommended to consult the Managers so that the Managers can ensure that P&I cover is not prejudiced.
If you have any questions, please contact the Group Legal Department in Gard AS.
Yours faithfully, GARD AS As agent only for Assuranceforeningen Gard -gjensidig-
Claes Isacson Chief Executive Officer
Gard is a member of
