Understanding how to manage split deliveries, multiple transport documents, and compliance timelines under UCP 600.
✅ Executive Summary
In global trade, it’s rarely practical to deliver a full order in one shipment.
Manufacturing schedules, logistics constraints, and vessel availability often require multiple deliveries, known as partial shipments.
Under the UCP 600 framework, these partial deliveries are not only allowed — they are a normal and efficient way to manage large or time-sensitive contracts.
However, they also bring documentary complexity, presentation challenges, and timing risks that can affect when and how the beneficiary gets paid.
“A partial shipment may divide the cargo — but it should never divide compliance.”
✅ 1. What Is a Partial Shipment?
A partial shipment occurs when goods covered by a single Letter of Credit are shipped in two or more consignments, whether by the same or different means of transport, and usually at different times.
Example:
An LC for 10,000 MT of rice may be shipped as:
5,000 MT on Vessel A (April 1)
5,000 MT on Vessel B (April 15)
Each shipment is supported by its own Bill of Lading (B/L) and set of documents, but both fall under the same LC.
✅ 2. Legal Basis Under UCP 600
UCP 600 Article 31 governs partial shipments and establishes clear principles:
| Clause | Summary | Effect |
|---|---|---|
| Art. 31(a) | Partial shipments are allowed unless expressly prohibited in the LC. | Default = ALLOWED |
| Art. 31(b) | Shipments on the same vessel and same voyage but under multiple documents = NOT partial. | Treated as one shipment |
| Art. 31(c) | Shipments on different vessels or different transport modes = Partial shipments. | Allowed if LC permits |
In short: If not prohibited, partial shipments are permitted by default.
✅ 3. How Partial Shipments Affect Payment Timing
Each shipment creates a separate right to payment, provided that:
The documents for that specific shipment are compliant.
Presentation occurs within the allowed period after shipment.
The total value remains within the LC amount or tolerance limit (Art. 30).
💡 Example: Payment Sequence
| Shipment | Shipment Date | Presentation Deadline | Payment Date |
|---|---|---|---|
| 1st | April 1 | April 16 (within 15 days) | April 20 |
| 2nd | April 15 | April 30 (within 15 days) | May 4 |
If the LC allows sight payment, the beneficiary can receive funds after each compliant presentation — not after the final shipment.
Pro Tip: For liquidity optimization, exporters should negotiate “payment per presentation” clauses instead of “payment after completion.”
✅ 4. Key SWIFT Fields for Partial Shipments
| SWIFT Field | Description | Example |
|---|---|---|
| 43P | Partial Shipments | ALLOWED or NOT ALLOWED |
| 43T | Transshipment | ALLOWED or NOT ALLOWED |
| 44C | Latest Shipment Date | Defines deadline for the final shipment |
| 44E | Port of Loading | Must be consistent across shipments |
| 44F | Port of Discharge | Same or different, depending on trade terms |
| 48 | Period for Presentation | e.g., “Within 15 days after shipment” |
| 71B | Charges | Allocation of costs per shipment |
If Field 43P is left blank, the default ICC rule applies: Partial shipments are allowed.
✅ 5. The Operational Impact on Documentation
Each partial shipment must have its own set of documents — complete and compliant.
Typical documents include:
Commercial Invoice
Transport Document (Bill of Lading, Air Waybill, etc.)
Certificate of Origin
Packing List
Insurance Certificate (if applicable)
Important Rules:
Each set must reference the same LC number.
Each presentation must fall within the allowed presentation period.
Any missing or inconsistent document can cause partial rejection or delay in payment.
“Each partial presentation is treated as a standalone LC — only smaller.”
✅ 6. Common Problems and How to Avoid Them
| Problem | Cause | Impact | Solution |
|---|---|---|---|
| Documents for shipment #2 presented after expiry | Delay in logistics or documentation | Non-payment | Negotiate longer presentation period (Field 48) |
| Different vessels or ports without LC update | Lack of notice to bank | Discrepancy | Insert “shipment from any port in [country]” |
| Insufficient insurance coverage | Policy tied to single shipment | Incomplete protection | Use open cover or “all shipments” policy |
| Overlapping invoice totals | Poor internal tracking | Overpayment / rejection | Use tracking matrix by LC reference |
| Bank confusion over sequence | Inconsistent B/L numbering | Payment hold | Label each shipment: “1st of 3,” “2nd of 3,” etc. |
✅ 7. Presentation Deadlines: How UCP 600 Handles Time
Under Article 14(c) of UCP 600:
“Documents must be presented no later than 21 calendar days after the date of shipment, but not later than the expiry date of the credit.”
This means:
Each partial shipment triggers its own 21-day presentation window.
However, LC expiry date still applies to the final presentation.
Example:
If an LC expires on May 30, and the second shipment occurs on May 20,
the documents must be presented by May 30, not June 10 — even though 21 days haven’t elapsed.
Tip: Always extend the LC expiry to cover the final shipment’s presentation period.
✅ 8. Strategic Advantages of Allowing Partial Shipments
| Advantage | Description |
|---|---|
| Improved cash flow | Each shipment can trigger partial payment. |
| Lower storage cost | Avoids warehousing full stock before shipment. |
| Supply continuity | Keeps buyer’s operations running. |
| Reduced risk | Smaller shipments mean smaller exposure per voyage. |
| Operational flexibility | Allows substitution of vessels or carriers. |
Exporter’s gain: Faster liquidity and reduced demurrage.
Importer’s gain: Phased delivery and smoother inventory management.
✅ 9. When to Restrict Partial Shipments
Not all deals benefit from flexibility. Some should restrict partial shipments to maintain control.
| Scenario | Reason to Restrict |
|---|---|
| High-value machinery | Risk of missing components |
| Perishable goods | Must arrive together for quality reasons |
| Turnkey projects | Final acceptance depends on complete delivery |
| Limited insurance coverage | Partial losses harder to claim |
| Political risk zones | Multi-entry logistics increase exposure |
Use “PARTIAL SHIPMENTS NOT ALLOWED” only when operationally justified.
✅ 10. Compliance and Communication Tips
State “Partial Shipments Allowed” explicitly to prevent confusion.
Match each shipment’s documents to LC requirements exactly.
Number all Bills of Lading sequentially to reflect shipment order.
Ensure insurance covers multiple shipments under one policy.
Update buyer and bank before dispatch of each load.
Keep SWIFT MT799/199 updates to inform advising banks of progress.
Monitor presentation deadlines per shipment — not per LC.
✅ 11. Example LC Clause for Partial Shipments
“Partial shipments are allowed.
Each partial shipment shall be considered a separate presentation under this Letter of Credit.
Payment shall be made upon each presentation, provided all documents are in full compliance with LC terms.
Shipment and document presentation for each partial shipment must occur within the validity period of this LC and within 21 days after the date of shipment.”
✅ 12. Digital and Fintech Implications (2025 Update)
Modern trade platforms have automated partial-shipment workflows to reduce manual errors:
| Platform | Functionality | Benefit |
|---|---|---|
| Contour / Komgo | Smart LC creation and document tracking | Real-time compliance |
| Traydstream / Cleareye.ai | AI document examination | Error reduction |
| Finastra Trade Innovation | SWIFT integration with partial logic | Timely payment release |
| Marco Polo (Blockchain) | Smart contract execution by shipment | Automated disbursement |
| XDC Network / TradeTrust | Digital B/L tracking | Faster title transfer |
In digital trade ecosystems, each partial shipment can now trigger instant document validation and conditional release of payment — improving trust and cash flow simultaneously.
✅ 13. Key Takeaways
| Focus Area | Best Practice |
|---|---|
| Allowing partial shipments | Use when logistics or production is phased |
| LC drafting | Define clear terms in Field 43P and 48 |
| Presentation timing | Treat each shipment independently but within overall expiry |
| Payment logic | “Per presentation” ensures faster liquidity |
| Document sets | Each shipment = one complete, compliant package |
| Automation tools | Use fintech platforms for tracking and error prevention |
✅ Conclusion
Partial shipments are the engine of flexibility in global trade — allowing supply chains to breathe, factories to operate continuously, and financiers to manage liquidity efficiently.
But flexibility must never compromise compliance:
Each shipment, document, and presentation must be structured as if it were a separate LC.
Control the timeline. Control the cash flow. Control the risk.
That’s the power of mastering partial shipments under UCP 600.
