Notify Party: The Ultimate FAQ Guide - Bansar China (2024)

If you’re wondering what notify party is all about, I will explain it right here.

So keep reading to learn more.

What Is A Notify Party?

Notify Party

Notify party is contact person or a party that carriers notify immediately with information regarding a shipment upon arrival at the destination.

A notify party can be a freight forwarder, customs broker, or intermediary.

The notify party also has an obligation of arranging all the customs clearance processes at the destination port.

What Is The Role Of Notify Party In An International Shipment?

International Shipping

A notify party is responsible for receiving notification on the arrival of a shipment from the carriers.

The notify party prepares all the formalities that will help fasten the clearance process of the cargo upon arrival at the port.

The carriers inform the notify party of the estimated time of arrival, location of shipment, and any other relevant details present.

If the cargo is under a letter of credit cover, the notify party will follow up with the bank to get the receipt of the documents in case the cargo delays.

Notify party also has a responsibility to follow up on the whereabouts of the cargo and not to rely on/wait for the carriers to inform them.

Note, the carrier always denies liability of any damages on the cargo even when the notify is or is not informed.

Is There A Relationship Between Consignee And A Notify Party In A Bill Of Lading?

A Consignee

A consignee is a person with the right to receive a cargo that is covered under the bill of lading.

While a notify party is someone who receives notification from the carrier upon arrival of the cargo at the destination port.

There may be some instances of the relationship between the consignee and the notify party whether is contractual or non-contractual.

Depending on how the bill of lading is consigned and combination, the following are some of the instances of known relationships.

Types of consignee relationship to the notify party include;

• To order or to order of shipper
• To order of XYZ bank
• ABC company
• Name of individual

Types of notify relationship to the consignee include;

• DEF forwarder
• ABC company
• Same as consignee
• Name of the individual

DEF forwarder: The notify party can act as a freight forwarder at the destination port which is under the authorization to receive, clear, and deliver to the recipient.

This is only after you receive the endorsed bill of lading.

ABC Company: A notify party can be the final receiver who receives the notification of impending arrival of shipment.

But normally pays the consignees bank the payments according to the contract once the notification is received.

This facilitates issuing of the endorsed bill of lading that allows the release of cargo.

Same as consignee: applies only when there is no specific notify and it’s only applicable on the consignee field.

Name of individual: a notify party can be the actual receiver but in case of cargo carries personal effects it will be the shipper.

Can Shipper And Notify Party Be The Same?

No, the shipper and notify party cannot be the same.

These are two separate entity/person with different responsibilities.

A shipper is an entity or party responsible for shipping goods.

The shipper is responsible for packaging and preparing goods for shipment as well as preparing all the paperwork and documents required.

A notify party is a person who receives notification from the carrier of the arrival of the cargo at the destination port.

The notify party is responsible for arranging all formalities that speed up the customs clearance of the cargo.

It’s the responsibility of the carrier or shipper to inform the notify party of the estimated time of arrival of the shipment and location.

What Happens When A Carrier Fails To Notify Party Of Shipment Arrival?

Accurate, clear, and steady information is a vital element while shipping any shipments.

Failure to provide/notify the notify party of the arrival of a shipment to have repercussions such as delays among others.

Below are some of the consequences/repercussions as a result of failure to notify a notify party;

Delay In The Arrangement Of Inland Haulage

The clearing agents or the notify party to have an obligation of preparing for the inland transport.

Failure to notify the notify party of the arrival and release of cargo results in poor planning.

Which results in to delay in transporting the shipment from the port to the client’s address location.

Delay In Clearance

Sometimes the notify party will be different from the consignee.

If this occurs and these parties fail to inform the notify party of the carrier’s estimated time of arrival, there are dire consequences.

The means the notify party will not be able to complete the custom clearance processes in time.

This results in delays in clearance.

Delays in clearance mean damages on the shipment and additional storage charges.

To curb this problem, you may engage pro-active clearing agents.

They follow up and make all necessary arrangements to fasten the clearance process.

Breakage In Supply Chain

It’s easier to calculate the storage and proper planning of the warehouse especially if the storage space is at a premium.

This factor is also dependent on how fast the cargo moves out of the warehouse.

Any delays in clearance of the shipment upon arrival greatly affect planning and calculations which adversely affects the supply chain.

Most immediate deliveries and lean supply chains are a result of delays in deliveries.

Overstock Situation

Failure to notify the notify party will result to slow clearance and delivery of cargo to the clients.

This results in the accumulation of goods in the warehouse hence overstocking.

Out Of Stock And Failure To Deliver On Time To Consumers

Failure to notify the notify party and clearance delays results out of stock situations.

This not only affects the clients but also sellers and distributors.

This delay immensely affects business if there is no robust solution to turn to.

Damage To The Cargo

There is a big difference when it comes to the shelf life of cargo.

Some have a shorter shelf-life while others have longer.

Failure to inform a notify party will result in delays which reduces the shelf-life of the cargo and sometimes leading to expiry.

It is therefore important for the notify party to be aware of the arrival time of such cargo with a shorter shelf-life.

This allows them to make necessary arrangements for storage and to fasten the clearance process.

Nowadays, there is the use of trackers on the cargo that allows the consignee to constantly check on the status of the cargo.

Are Carriers Liable For Failure To Inform The Shipper Of Goods On An Order-Notify Bill Of Lading?

Bill of landing

Who is responsible for the failure of notifying the notify party is always a big question especially from the importer’s side?

The carrier is not responsible/liable for failure to inform the shipper of good on order notify.

This is because the carriers render the notification as a service.

Carriers have no obligation whatsoever to always informing the shipper.

The consignee has an obligation too of making a follow-up or tracking their shipment.

In most cases, the carriers will not accept the liability unless there are dire consequences if they fail to accept liability.

What Details Should Be Shown On The Field Of Notify Party On The Bill Of Lading?

Normally, the intention of having a notify party is to be informed of the arrival of a shipment at the port destination.

The field of the notify party on the bill of lading should contain;

• Name
• Address
• Contact phone number of the notify party.
• Email or fax information of the notify party.

What Is A Notifying Address In A BOL?

A notifying address is an address which you will find in a bill of lading where the carrier should give a notice of due dates of arrival of cargo.

Mostly this notify address is in form of a clause that you can insert in a bill of lading.

Agents of the company send notification at/of the arrival of the shipment.

However, neither the company nor agents have a responsibility to notify therefore, they are not reliable for information failure.

Normally, a bill of lading form contains an empty box slot named ‘’notify address’ ’

Failure of the shipper to include the name of the consignee, requires the shipper to transact, indorse, and deliver the bill of lading before delivery of the shipment.

In other cases, the shipper may not know who to deliver or notify on the arrival of the shipment. This occurs especially if there is no transfer of the bill of lading before the start of sailing or if the goods have not been sold.

Who Can Be Shown As A Notify Party In A Bill Of Lading?

There are several instances of who can be shown/one who you can consider as a notify party in a bill of lading.

They include;

Agent Of The Consignee

Cargo receipt can either nominate a clearing agent or freight forwarder.

Their main purpose is to arrange for clearance and delivery of the cargo to the recipient.

The Actual Receiver Of The Cargo

Where the billing of lading is consigned to order, an actual receiver of the cargo will be shown as a notify party.

This makes them aware of when to expect the arrival of the shipment at the port.

Trader Or Indenting Agent

This is normally the broker of the shipment who has the intention of keeping track of the progress status of the shipment.

• Any other entity that may want to know the arrival and departure of the shipment.

Again, they will show directly indirect interest in the system.

Can Notify Party Make Payments?

Yes, notify party can make payments.

The notify party can make this payment in advance or during delivery of goods.

Furthermore, if there is an agreement between the buyer and shipper the payment can be made in installments.

While making these payments there is the involvement of financial institutions such as banks. Normally, there is the involvement of two banks, one acts as a guarantee for payment of the buyer to the other upon meeting certain conditions.

This is what we term as letters of credit.

There are other payment methods under the Incoterm that allows the notify party to be able to make payments.

Once all the formalities are successful, the buyer will receive the goods as agreed and ensure they are in the right condition.

What Are The Considerations When Filling Out Notify Party Field In A Shipping Document?

Below are some points of consideration when you are filling out a notify party field.

They include;

• The payment method you select may affect notify party field completion.
• The notify party has no connection whatsoever with the title of goods.
• You must complete notify party field under the letters of credit payment methods according to the letters of credit terms and conditions.
• The shipper can freely fill notify party field without any restrictions.

This only happens under an open account, cash in advance, or cash against documents payments methods.

Is Notify Party The Same As Booking Party In Shipping?

No, a notify party and booking party in shipping are not the same.

As indicated earlier, a notify party is responsible for arranging the formalities which help in clearing and delivery of goods to the receiver.

A notify party receives notification from the carrier on the arrival of a shipment at the port, location, and the estimated time of arrival.

A booking party is an entity responsible for all handling and operations that the third party carries out under a booking number provided.

Can Notify Party Be Able To Order?

A notify party is an entity that receives notification from the carrier upon arrival of the shipment at the destination port.

A notified party can be a customs broker, freight forwarder, or the actual buyer of the goods. Therefore, the notify party can be able to order goods and still act as a notify party.

Can There Be Multiple Notify Party In A Bill Of Lading?

There is no exclusion on who a notify party should be.

A notify party can be forwarding or clearing agents, receivers, or senders of this cargo.

It’s a must notify party to be aware of the arrival of this cargo.

Normally, an entity that provides all shipping instructions to a shipping line also provides the details of the notify party.

So, yes there can be multiple notify party in a bill of lading unlike in consignee.

This means the bill of lading has no restrictions on the number of notify party that can be in a bill of lading.

To include the multiple, notify party in a bill of lading document, you will find these entry fields where you will be able to enter the notify parties.

If there is less space on the bill of lading field, you can choose a different point on the same document and enter the notify parties.

What Is The Liability Of The Notify Party In The Bill Of Lading?

A notify party should not only wait for the shipping line or carriers to notify them.

They should take further steps in arranging for the clearance process and follow up on cargos that are under the letters of credit with banks.

This allows the notify party to obtain receipt documents of the cargo in case of any delays.

For all your shipping from China, BanSar is here to help – contact us now.