Ame rican Club Circular No. 38/15 1 OCTOBER 29, 2015 CIRCULAR NO. 38/15 TO MEMBERS OF THE ASSOCIATION Dear Member: ELECTRONIC (PAPERLESS) TRADING SYSTEMS - FREQUENTLY ASKED QUESTIONS: ELECTRONIC SHIPPING SOLUTIONS (ESS), BOLERO INTERNATIONAL LTD (BOLERO), E-TITLE AUTHORITY PTE LTD Members may wish to note the approval by the International Group of P&I Clubs of the e-title™ solution. Members will recall, as reported in Circular No. 24/10 of September 16, 2010, that, until February 2010, the rules of all Group clubs specifically excluded liabilities in respect of the carriage of cargo under all electronic, i.e. paperless, trading systems to the extent that the liabilities under such systems would not have arisen under a ‘normal’ paper system i.e. one using transferable paper documentation. From February 20, 2010 liabilities arising in respect of the carriage of cargo under such systems were covered, provided that the system had first been approved by the Group. The first two systems approved by the Group were those administered by ESS (more specifically the version referred to as DSUA 2013.1) and by Bolero (more specifically the Rulebook/Operating procedures September 1999.) Both of those systems continue to be approved. In addition, the e-title™ solution can now be added to the list of approved electronic, i.e. paperless, systems. E-title™ is a secure mechanism focusing exclusively on title transfers, complementing existing web-portal services offered by shipping lines, logistics operators and trade facilitators. The solution is supported by a legal framework to facilitate the electronic exchange of bills of lading and waybills, removing the need for a paper bill of lading. Further details can be found on the company’s website – http://www.e-title.net The legal documentation associated with the use and operation of the e-title™ solution is the Electronic Title User Agreement (version 1.2). This document has been extensively reviewed by the Group. Exclusions of cover under Group club rules relating to the carriage of cargo will of course continue to apply in respect of ESS, Bolero and e-title™ in the same way as for paper systems. These exclusions include discharge at a port or place other than the port or place provided for in the contract of carriage, the issue/creation of an ante- or post-dated electronic document/record, and the delivery of cargo without the production of the negotiable electronic document/record, which in the American Club Circular No. 3 8/15 2 case of an approved electronic trading system will mean delivery of cargo other than in accordance with the rules of that trading system. As with previous electronic systems, it would be helpful to the Group, in monitoring the use and development of these three systems, if Members who are using any of them would advise the Club of any benefits or difficulties which they encounter, legal or practical, in the operation of the systems. Yours faithfully, Joseph E.M. Hughes, Chairman & CEO Shipowners Claims Bureau, Inc., Managers for THE AMERICAN CLUB All clubs in the International Group of P&I Clubs have issued similar circulars. American Club Circular No. 3 8/15 3 ATTACHMENT TO CIRCULAR NO. 38/15 OF OCTOBER 29, 2015 PAPERLESS TRADING (ELECTRONIC BILLS OF LADING) FREQUENTLY ASKED QUESTIONS (FAQs) 1. What is the position of the International Group of P&I Clubs with regard to pap erless trading? The posit ion is set out in Circula r No. 24/10 of September 16, 2010 Electronic (Paperl