On The Effect Of Shipping Guarantee

With the rapid development of International trade and Ocean shipment, traditional B/L system gradually cannot fit the more and more complicated daily practice. Meanwhile, Maritime Letter of Indemnity is widely used. However, different countries, including China, have not reached any agreement upon Maritime Letter of Indemnity's legal effect; neither does any country have specific laws and regulations regarding it. International Trade and Ocean shipment industry not only obtain convenience and efficiency from using Maritime Letter of Indemnity, but also suffer big loss caused by Maritime Letter of Indemnity fraud. Maritime judicial administration has great difficulty in judging Maritime Letter of Indemnity related cases as well. The only way to solve these problems and limit Maritime Letter of Indemnity's defects to the minimum is to legislate Maritime Letter of Indemnity's legal effect. This article mainly focuses on legal effect of Maritime Letter of Indemnity. It looks into current status and features of Maritime Letter of Indemnity legal effect trying to set up a set of complete standards to judge legal effect of different types of Maritime Letter of Indemnity. The purpose of setting up the standards is to eliminate Maritime Letter of Indemnity's bad impact on traditional B/L system. In addition, this article introduces current regulations of Maritime Letter of Indemnity of China. Some advices are given in terms of legislation and Ocean shipment practice to complete Chinese Maritime Law system. After these analysis and discussion, this article comes to a conclusion that, Maritime Letter of Indemnity is needed by Ocean shipment practice. Its good side is much more than bad side. It is very necessary to firm its legal effect by law. Only in this way, the good side of valid Maritime Letter of Indemnity can be realized in daily practice, while the bad side of invalid Maritime Letter of Indemnity can be eliminated.