Partial Shipment Rules Under UCP 600: Avoiding LC Discrepancies

 

Partial Shipment Rules Under UCP 600: Avoiding LC Discrepancies 

 Last Updated: 15 November 2025

Understanding the Real Meaning of “Partial Shipment”

I remember early in my trade finance days, I was helping a client handle a letter of credit, and we ran into the concept of partial shipments. It’s actually pretty straightforward once you see it in action.

Q&A: Partial Shipments & Partial Drawings — With Exact References (UCP 600 & ISBP 821)

 

Q1 — Are partial shipments allowed under UCP 600?

Answer:

Yes. Partial shipments are allowed unless prohibited in the credit.

Reference:

 UCP 600 — Article 31(a):

“Partial shipments are allowed.”

 

Q2 — What creates a partial shipment according to UCP 600?

Answer:

A shipment is partial when goods are shipped on more than one means of conveyance, even if they are shipped on the same day.

Reference:

 UCP 600 — Article 31(b):

“Shipment on more than one vessel, aircraft or other means of conveyance, even if for the same destination and on the same day, will be considered a partial shipment.”

 

Q3 — Do different loading dates (different dates of shipment) create a partial shipment?

Answer:

No.

Different loading dates do not constitute a partial shipment as long as the transport documents indicate shipment on the same means of conveyance (same vessel, same voyage).

Reference:

 UCP 600 — Article 31(b) :

"A presentation consisting of more than one set of transport documents evidencing shipment commencing on the same means of conveyance and for the same journey, provided they indicate the same destination, will not be regarded as covering a partial shipment, even if they indicate different dates of shipment or different ports of loading, places of taking in charge or dispatch. If the presentation consists of more than one set of transport documents, the latest date of shipment as evidenced on any of the sets of transport documents will be regarded as the date of shipment.

A presentation consisting of one or more sets of transport documents evidencing shipment on more than one means of conveyance within the same mode of transport will be regarded as covering a partial shipment, even if the means of conveyance leave on the same day for the same destination."  

 

Q4 — If an LC prohibits partial shipments, what conditions must the documents meet?

Answer:

All goods must be shown as shipped on:

 one vessel / one means of transport
 one voyage / one flight
 one shipment operation

Any split across different conveyances = partial shipment = discrepancy. 

Reference:

 Derived from UCP 600 — Article 31(b) (definition of partial shipment)

Because if more than one means of conveyance is used → partial shipment → not allowed when LC prohibits it.

 

Q5 — Do multiple transport documents automatically create a partial shipment?

Answer:

No.

Multiple transport documents do not result in a partial shipment if:

 they show the same vessel/flight
 same voyage
 same loading and discharge points

Reference:

 UCP 600 Article 31(b) :

" A presentation consisting of more than one set of transport documents evidencing shipment commencing on the same means of conveyance and for the same journey, provided they indicate the same destination, will not be regarded as covering a partial shipment, even if they indicate different dates of shipment or different ports of loading, places of taking in charge or dispatch. If the presentation consists of more than one set of transport documents, the latest date of shipment as evidenced on any of the sets of transport documents will be regarded as the date of shipment. 

 A presentation consisting of one or more sets of transport documents evidencing shipment on more than one means of conveyance within the same mode of transport will be regarded as covering a partial shipment, even if the means of conveyance leave on the same day for the same destination."

 

Q6 — Are partial drawings allowed under UCP 600?

Answer:

Yes. Partial drawings are allowed unless the LC prohibits them.

Reference:

 UCP 600 — Article 31(a)):

“Partial drawings or shipments are allowed.”

 

Q7 — What happens if an LC requires instalment shipments and one instalment is missed?

Answer:

If the beneficiary fails to ship or draw under one instalment within the required period,

 the credit ceases to be available for that and any subsequent instalment
unless the credit states otherwise.

Reference:

 UCP 600 — Article 32 :

If a drawing or shipment by instalments within given periods is stipulated in the credit and any instalment is not drawn or shipped within the period allowed for that instalment, the credit ceases to be available for that and any subsequent instalment.  

 

Q8 — If goods are loaded on different days but shown as one shipment on one vessel, is this partial shipment?

Answer:

No.

Different loading dates are not relevant as long as the transport document consolidates the shipment on the same vessel and voyage.

Reference:

 ISBP 745:

“Different dates of shipment or loading do not create a partial shipment when the documents indicate shipment on the same vessel and voyage.”

 

Q9 — What if the beneficiary presents several B/Ls because different containers were used?

Answer:

Not a partial shipment, as long as the B/Ls show:

 same vessel
 same voyage
 same loading/discharge ports

Reference:

   precise reference ISBP 745  also  clarifies on UCPDC:

Multiple B/Ls issued for separate containers are not partial shipments if they indicate shipment on the same vessel/voyage.

 

Q10 — What if two transport documents show different vessels?

Answer:

This is a partial shipment, regardless of date, container use, or place of loading.

Reference:

 UCP 600 — Article 31(b):

Shipment on more than one vessel or means of conveyance = partial shipment.

In the world of documentary credits, few terms are as operationally sensitive — yet often misunderstood — as Partial Shipment. In international Shipping this term determines not only how goods move, but how money moves. A single misinterpretation can trigger LC discrepancies, delay payment, or even derail the entire transaction.

But for trade finance professionals and documentary credit specialists, the question is not how goods move physically — it is how shipment is represented in the transport document, and how the credit terms interact with UCP 600.

The governing provision, UCP 600 Article 31, remains one of the most critical interpretive clauses for both banks and traders. Understanding it goes beyond knowing the words — it requires grasping the banking logic and legal effect of each subsection.

1. Article 31(a): Partial Drawings or Partial Shipments Are Allowed.

“Partial Drawings or Partial Shipments Are Allowed.”

This is a foundational rule. Unless the L/C explicitly states “Partial shipments not allowed”, the beneficiary is entitled to make multiple shipments under one credit.

Expert Analysis:

·         The default permission protects exporters, ensuring flexibility in supply or production schedules.

·         The onus is on the applicant (importer) to prohibit it when uniform delivery is required.

·         A bank’s duty is to apply the default rule strictly — it cannot infer prohibition if not expressly stated.

Practical Risk:

Many discrepancies arise when applicants assume that “one shipment only” is implied — but under UCP, only express wording restricts partial shipment.

Hence, the precise drafting of the credit is critical.

 

2. Article 31(b): Same Conveyance ≠ Partial Shipment

“A shipment on the same vessel, aircraft, or other means of conveyance is not considered to be a partial shipment even if separate sets of transport documents are presented, provided that the goods are shipped under one contract of carriage for the same destination.”

 

Expert Interpretation:

Here, the ICC clarifies that the means of conveyance and contract of carriage are the determining factors — not the number of documents or dates.

So, if goods are shipped:

·         On the same vessel,

·         Under the same contract of carriage, and

·         Bound for the same port or place of destination,

then even if multiple Bills of Lading are issued or the loading occurs over several days, the presentation is not to be treated as a partial shipment.

Operational Example:

A shipment of 1,000 MT of copper cathodes loaded in three batches on the same vessel MV Silver Sea, from Shanghai to Singapore, with three Bills of Lading:

·         BL No. 1 dated 10 June

·         BL No. 2 dated 11 June

·         BL No. 3 dated 12 June

Result: This is one shipment, not partial, as per Article 31(b).

Bank Practice Note :

Banks should cross-check:

·         Vessel name — must be identical across documents.

·         Destination — must match.

·         Carriage contract — must show one continuous voyage.

If these are consistent, separate Bills of Lading do not constitute partial shipment.

 

 

3. Article 31(c): Different Conveyances = Partial Shipment

“If more than one set of transport documents evidences shipment on more than one means of conveyance, even if for the same destination and on the same day, this constitutes partial shipment.”

Interpretation:

Whenever goods are shipped using different vessels, trucks, or aircraft, each carriage is a distinct shipment.

This remains true even if:

·         The shipments depart on the same day, or

·         The destination is identical.

Case Study:

A seller ships 500 MT of goods on MV Pacific Star and another 500 MT on MV Atlantic Wind, both destined for Dubai on the same date.

Each has its own Bill of Lading.

Result: This is a partial shipment, as it involves different conveyances.

If the L/C prohibits partial shipment, this would constitute a discrepant presentation.

Expert Commentary:

The ICC rule recognizes that different carriers mean different contracts of carriage — hence, separate risk exposure and delivery timelines. From a bank’s perspective, that equals partial shipment, irrespective of physical simultaneity.

 

4. Article 31(d): Multimodal Transport Documents (MTDs)

Modern trade logistics often involve combined transport, such as “truck + sea” or “rail + air.”

The multimodal transport document (MTD) captures this single through movement under one carrier’s responsibility.

Under Article 31(d), if the goods are dispatched from different places but covered under a single MTD, and represent one continuous transport, the shipment is not partial.

Operational Meaning:

Even if loading happens at different inland depots or ports, as long as:

·         The MTD shows one contract of carriage, and

·         The goods are moving to the same final destination,

Note:

Document checkers must verify:

·         Only one multimodal transport document is issued.

·         It covers all goods, same consignee, same destination.

 

5. Documentary Examination: The Banker’s Checklist

Banks examine documents — not physical goods.

Hence, the determination of partial shipment is purely documentary.

Check Item	Bank’s Examination Focus	Result

 

Check Item	Bank’s Examination Focus	Result
Vessel / Transport name	Same vs. different conveyance	Different = partial
Number of transport documents	One or more sets	Multiple = potential partial
Destination	Identical or different	Different = partial
Issue date	Not decisive alone	Different dates can still be single shipment
Carriage contract	Continuous or separate	Separate = partial

 

 

 

 

6. Transshipment vs. Partial Shipment — Common Confusion

These two terms are often conflated but legally distinct:

Term Meaning UCP Reference Partial Shipment Delivery of goods in two or more separate consignments under one credit Article 31 Transshipment Transfer of goods from one vessel to another during carriage to the final destination Article 20(c)
A transshipment is not a partial shipment. Transshipment happens after shipment has occurred, not instead of it. Expert Tip: An L/C may allow partial shipments but prohibit transshipment, or vice versa. Each must be evaluated separately during document checking.   7. Case Insight — ICC Opinion TA 617rev (2007) This ICC opinion clarified that multiple Bills of Lading issued for the same vessel, same destination, and same voyage do not represent a partial shipment. The deciding factor is the conveyance, not the number of documents or onboard dates. Professional Takeaway: This opinion reinforces Article 31(b) and remains a cornerstone for  professionals handling multi-document presentations.

8. Commercial & Risk Implications

Stakeholder	Why It Matters
Exporter / Beneficiary	Flexibility to deliver goods in stages. Must check L/C terms before shipping.
Importer / Applicant	May prohibit partial shipment to ensure full cargo arrival.
Issuing Bank	Ensures compliance with L/C and UCP 600 Article 31; avoids wrongful honor.
Advising / Negotiating Bank	Must detect discrepancies early to avoid liability under Article 14.

 

 

Risk of Misinterpretation:

·         Incorrectly treating a multi-BL shipment on the same vessel as “partial” may cause wrongful refusal.

·         Conversely, overlooking truly separate conveyances may expose the bank to reimbursement risk.

9. Key Takeaways

1.      Default rule: Partial shipments allowed unless prohibited.

2.      Means of conveyance and carriage contract are decisive, not number of documents.

3.      One vessel = one shipment, even if multiple B/Ls.

4.      Different vessels or transport = partial shipment, regardless of date or destination.

5.      Multimodal document under one contract = not partial.

6.      Always cross-check destination, vessel, and carriage terms before determining compliance.

 

Case Study: Partial Shipment Dispute under UCP 600

Scenario:

An issuing bank enters into a documentary credit (L/C) governed by UCP 600 that is expressly marked “Partial shipments **not allowed”. The credit requires shipment of 10,000 MT of cement from a Chinese port to New York. The credit specifies that all documents must evidence shipment in one lot (i.e., no partial shipments or drawings).

The beneficiary presents two sets of transport and shipping documents:

·         Set 1: Bill of Lading (“BL 1”) dated 1 May 2010, voyage No. 888 on vessel MV OMG, covering 6,000 MT discharged at New York.

·         Set 2: Bill of Lading (“BL 2”) also dated 1 May 2010 (later in the day) on the same vessel MV OMG, same voyage No. 888, same destination New York, covering the remaining 4,000 MT.

The issuing bank refuses the presentation, stating: “Partial shipment is made and is not allowed in the credit.” The beneficiary argues that under Article 31(b) of UCP 600 the two shipments were on the same vessel, same voyage, same destination, hence they should not be treated as partial shipments.

 

Analysis of the Dispute

1.      UCP 600 Article 31(b) & (c) Application

o    Article 31(a): “Partial drawings or shipments are allowed.”  Here the credit prohibits partial shipments—so the default permission is removed.

o    Article 31(b): “A presentation consisting of more than one set of transport documents evidencing shipment commencing on the same means of conveyance and for the same journey, … will not be regarded as covering a partial shipment, even if they indicate different dates of shipment or different ports of loading…”

o    Article 31(c): “A presentation consisting of one or more sets of transport documents evidencing shipment on more than one means of conveyance … will be regarded as covering a partial shipment…”

In this scenario:

o    The conveyance is the same vessel (MV OMG) on the same voyage number 888;

o    Destination is identical (New York);

o    Loading is split into two sets, but still under the same voyage.

• Issue: This conflicts with UCP 600 Article 31(b) and ICC Opinion TA 617rev. Two BLs on the same vessel, same voyage, same destination do not constitute a partial shipment, even if the credit prohibits partial shipment.

• Correction: Update conclusion to reflect CDCS-level accuracy:

“According to Article 31(b) and ICC Opinion TA 617rev, the two BLs on MV OMG are considered a single shipment. The bank’s refusal is technically incorrect, though practically exporters may still consolidate documents to avoid disputes."

2.      Interpretation: Number of Bills of Lading vs Conveyance

3.      Practical Bank / Exporter Considerations

o    The bank must check field 43P (Partial shipments) in the credit: here it states “Not allowed”. That means the beneficiary must present documents evidencing one single shipment.

o    Even though the voyage and vessel are identical, presenting two BLs suggests two shipments (two loadings). The bank is correct to challenge the presentation.

o    The beneficiary should have arranged for one BL covering full 10,000 MT (or other single document) if the credit prohibits partial shipments.

o    The exporter may argue logistics required two loadings, but the credit terms override operational realities — non-compliance leads to discrepancy.

4.       Key Takeaway

o    When a credit prohibits partial shipments, the beneficiary must ensure the indication of one shipment in documents — ideally one transport document or one set of documents.

o    Even though UCP 600 provides a narrow allowance under Article 31(b) for “same conveyance”, that is only relevant where the credit allows partial shipments. If it prohibits them, the narrow allowance becomes moot.

o    Banks must document their refusal carefully, referencing the credit field and Article 31(a) + prohibition.

o    Exporters must consider drafting and logistics early: if partial shipments may occur, ask for the credit to allow them (field 43P = “Allowed”).

 

Final Summary

In this case, the issuing bank’s refusal is justified: the credit explicitly prohibits partial shipments, and the presentation of two separate BLs covering two distinct loading sets constitutes two shipments, which breaches the credit. Even though both shipments were on the same vessel and voyage, under the prohibition clause the beneficiary should have consolidated into one shipment/document set.

 

 

Critique and Refinement of the Case Study Conclusion The central point of conflict is: Does the express prohibition of partial shipments in the credit (Article 31(a) override the definitional clarification of what constitutes a partial shipment in Article 31(b)? UCP 600 Provision Effect Article 31(a) Sets the condition for allowing/prohibiting partial shipments. (Here: Prohibited). Article 31(b) Provides the definition for when multiple transport documents on the same conveyance are NOT considered a partial shipment. The Precedent and Definitive View The long-standing ICC Opinion (e.g., TA617rev and related interpretations) clarifies that the definitional section, Article 31(b), operates before the prohibition in 31(a) is applied. 1.      A document checker must first define the presentation. 2.      The presentation is defined using Article 31(b): Since the two BLs cover shipment on the same vessel (MV OMG) and same voyage (No. 888) to the same destination (New York), the presentation of the two BLs is NOT a partial shipment as per the UCP 600 definition. 3.      Once the presentation is defined as a single shipment, the document checker then applies the condition from the credit (Article 31(a)). 4.      Since the credit prohibits "partial shipments," and the presentation is defined as a single shipment, the prohibition is not breached. Definitive  Conclusion (Correct): The beneficiary's argument, based on Article 31(b), is correct. The Issuing Bank's refusal, which was solely on the grounds of "Partial shipment is made and is not allowed in the credit," is wrongful. The presentation of two B/Ls on the same vessel/voyage/destination does not constitute a partial shipment under UCP 600, thus the credit's prohibition is not triggered. Why the Case Study's Conclusion is Practically Problematic Your original case study conclusion ("the issuing bank’s refusal is justified") aligns with a cautious exporter's perspective (i.e., to be safe, use one B/L). However, as a CDCS expert checking documents, the refusal is technically unjustified based on the UCP 600 text and established ICC rulings. ·         The UCP 600 provides the rules of engagement. If a credit prohibits partial shipment, but the presentation falls under the exception/definition in 31(b), the bank must honor the definition. ·         The bank's duty is to determine if a partial shipment was made. Article 31(b) definitively states no partial shipment was made in this scenario.  Refined CDCS-Level Key Takeaways on the Case Study 1.      Article 31(b) is Definitional: It establishes that certain multi-document presentations are not partial shipments. This definition applies even when the credit prohibits partial shipments under Article 31(a). 2.      No Discrepancy Found: The presentation of two B/Ls on the same MV OMG voyage is considered a single shipment under UCP 600. Since the credit prohibits partial shipments, and only a single shipment was made (by UCP definition), the credit term is complied with. 3.      Bank Error: The Issuing Bank's refusal is a classic error of conflating the operational reality (two sets of documents/loadings) with the UCP's legal definition of a shipment (single conveyance/journey). 4.      Exporter Caution: While the bank must honor the single shipment, the exporter's arrangement of two separate B/Ls when "Partial Shipments Not Allowed" is poor practice. The applicant likely intended one single document/drawdown. To avoid disputes, the beneficiary should always aim for a single transport document when partial shipments are prohibited.
A transshipment is not a partial shipment. Transshipment happens after shipment has occurred, not instead of it.
Expert Tip: An L/C may allow partial shipments but prohibit transshipment, or vice versa. Each must be evaluated separately during document checking.   7. Case Insight — ICC Opinion TA 617rev (2007) This ICC opinion clarified that multiple Bills of Lading issued for the same vessel, same destination, and same voyage do not represent a partial shipment. The deciding factor is the conveyance, not the number of documents or onboard dates. 💬 Professional Takeaway: This opinion reinforces Article 31(b) and remains a cornerstone for CDCS professionals handling multi-document presentations.      What is partial shipment allowed in LC? What is an example of a partial shipment? What is the difference between partial shipment and split shipment? What is partially shipped? Why is partial shipment unable to deliver? What is the difference between partial shipment and transshipment? What is a partial shipment clause in LC? Final Words : Partial Shipment vs Partial Drawing — UCP 600 & ISBP 821 1. Partial Shipment (Physical Movement of Goods) UCP 600 Article 31(a): “Partial drawings or shipments are allowed.” (ICC UCP 600 Official Text) Note: The article does not mention “unless otherwise stipulated in the credit.” Any restriction comes from the credit itself (field 43P). UCP 600 Article 31(b): “A presentation consisting of more than one set of transport documents evidencing shipment commencing on the same means of conveyance and for the same journey, provided they indicate the same destination, will not be regarded as covering a partial shipment even if they indicate different dates of shipment or different ports of loading, places of taking in charge or dispatch.”  UCP 600 Article 31(c): “A presentation consisting of one or more sets of transport documents evidencing shipment on more than one means of conveyance within the same mode of transport will be regarded as covering a partial shipment even if the means of conveyance leave on the same day for the same destination.”  Key Point: Partial shipment is determined by physical movement of goods (means of conveyance, journey, destination), not by number of drawings or documents. 2. Partial Drawing (Financial / Monetary Aspect) UCP 600 Article 14(a): “Presentation of documents in accordance with the terms of the credit is required for the beneficiary to obtain payment, acceptance or negotiation.” UCP 600 Article 31(a) confirms that partial drawings are allowed. Key Point: Partial drawing refers to the portion of the credit value being drawn. Partial shipment does not automatically require a partial drawing. One presentation can cover multiple shipments; the drawing may be for the total value or partial value. 3. ISBP 821 Guidance (Documentary Examination Perspective) ISBP 821 (Sections 31B01–31B03): Banks examine documents, not physical goods. Multiple transport documents for the same conveyance, journey, and destination do not automatically constitute a partial shipment. Partial drawing is optional even if multiple shipments are presented. Key Point: ISBP 821 provides guidance for banks on documentary examination, reinforcing the distinction between shipment and drawing. Scenario Partial Shipment? Partial Drawing? Comment Two batches shipped on the same vessel, same voyage, same destination; one presentation covers both batches ❌ No Optional Art 31(b) UCP 600 + ISBP 821 Two batches shipped on different vessels, same LC; separate presentations ✅ Yes ✅ Yes Art 31(c) UCP 600 triggers partial shipment; separate drawing if presented separately Two shipments on the same vessel, same voyage, same destination; covered by separate sets of transport documents ❌ No Optional Art 31(b) UCP 600 + ISBP 821. Separate documents covering goods shipped on the same means of conveyance for the same journey are not deemed partial shipments. Goods loaded on different trucks at different times to the same final destination, under one single Bill of Lading ❌ No Optional This is generally considered one single shipment. Unless the LC prohibits transhipment, transhipment is allowed (Art 21, 22, 23 UCP 600). The single B/L confirms a single contract of carriage. 5. Practical Takeaways for Trade Finance Professionals Partial shipment ≠ partial drawing. Always check field 43P of the credit for allowance/prohibition. Document examination must verify: Means of conveyance Voyage/journey Destination Whether multiple transport documents reflect the same conveyance/journey/destination If credit prohibits partial shipments, ensure single presentation evidences one shipment. Consolidating documents when feasible reduces operational risk, even if partial drawings are allowed. Summary Partial shipment: physical movement of goods (UCP 600 Art 31(b–c); ISBP 821 §§31B01–31B03). Partial drawing: portion of credit value drawn (UCP 600 Art 14(a) & 31(a)). Rule of thumb: A single presentation can cover multiple shipments; partial drawing is optional and does not depend on partial shipment. Author Bio Kazi Suhel Tanvir Mahmud, AVP, Senior Trade Finance Manager at AB Bank  with  24 years of experience in letters of credit, shipping documentation, and international trade compliance. During his career, he has overseen trade-finance operations, managed documentary credits, and ensured compliance with UCP 600 and banking regulations.   Connect with me on LinkedIn  Publications: “25 Cash Flow Forecasting Methods that Deliver Accuracy” – CFO Drive “21 Resources to Stay Updated On Financial Regulations and Trends” – CFO Drive

Tweet