B-157404, SEP. 29, 1965

B-157404, SEP. 29, 1965

TO THE SECRETARY OF STATE:

REFERENCE IS MADE TO THE LETTER OF MAY 12, 1965, ADDRESSED TO THE TRANSPORTATION DIVISION OF THIS OFFICE, FROM THE OFFICE OF FINANCE, DEPARTMENT OF STATE, WASHINGTON, D.C., ENCLOSING FOR OUR CONSIDERATION A COPY OF AN OPERATIONS MEMORANDUM DATED MAY 3, 1965, FROM THE AMERICAN EMBASSY, CAIRO, EGYPT. THE EMBASSY AT CAIRO DESIRES TO MAKE PAYMENTS IN EGYPTIAN POUNDS TO NEAR EAST SUPERINTENDING CO. (NESCO), THE LOCAL AGENT OF DEAN EXPORT INTERNATIONAL, LTD. (DEAN), FOR NESCO'S PORTION OF CHARGES DUE THEM IN CONNECTION WITH RESIDENCE TO RESIDENCE SHIPMENTS OF HOUSEHOLD EFFECTS MOVING ON GOVERNMENT BILLS OF LADING.

PRESENTLY, NESCO IS NOT PAID UNTIL THE GOVERNMENT BILLS OF LADING ARE ACCOMPLISHED AND THE EMBASSY IS BILLED BY DEAN; WHEREUPON THE EMBASSY MAKES TWO PAYMENTS, ONE TO DEAN FOR THEIR PORTION IN U.S. DOLLARS AND THE OTHER TO NESCO IN LOCAL CURRENCY. THE EMBASSY STATES THAT DEAN OWES NESCO FROM BETWEEN $11,500 AND $13,800, AND THAT NESCO IS REQUESTING PAYMENT FROM THE EMBASSY OR DEAN. DEAN DOES NOT WANT TO EXCHANGE U.S. DOLLARS THAT WILL REMAIN IN LOCAL CURRENCY AND, IN ORDER FOR THE RESIDENCE TO RESIDENCE SHIPMENTS TO BE CONTINUED, THE EMBASSY STATES A SOLUTION IS NEEDED WHEREBY NESCO CAN BE PAID LOCALLY IN EGYPTIAN POUNDS UPON PRESENTATION OF THEIR BILLS.

SINCE REGULATIONS REQUIRE ACCOMPLISHMENT OF GOVERNMENT BILLS OF LADING BEFORE PAYMENT IS MADE, THE EMBASSY INQUIRES IF THERE IS A LEGAL WAY TO PAY NESCO'S PORTION WITH DEAN FURNISHING A GUARANTEE ON THAT PORTION OF THE GOVERNMENT BILLS OF LADING.

IN ORDER THAT WE MIGHT OBTAIN A BETTER UNDERSTANDING OF THE PROBLEMS INVOLVED AND ACQUIRE ADDITIONAL INFORMATION, REPRESENTATIVES OF OUR TRANSPORTATION DIVISION MET WITH A REPRESENTATIVE OF THE OFFICE OF FINANCE, DEPARTMENT OF STATE AND DISCUSSED THE SUBJECT. IN CONSIDERATION OF THE PROBLEM, OUR REPRESENTATIVES ASKED FOR AN RECEIVED A GENERAL EXPLANATION OF THE DEPARTMENT OF STATE'S PAYMENT PROCEDURES AND THE USE OF EXCESS FOREIGN CURRENCIES. COPIES OF VOUCHERS AND INVOICES REPRESENTATIVE OF THE SUBJECT PROBLEM WERE ALSO FURNISHED THIS OFFICE.

NORMALLY, PAYMENT PROBLEMS BETWEEN A CARRIER AND ITS AGENT WOULD BE A MATTER TO BE RESOLVED BETWEEN THE CARRIER AND THE AGENT. IN THIS CASE, HOWEVER, THE GOVERNMENT DOES HAVE A DIRECT INTEREST IN THE PRESENT SITUATION, WHICH IS TO UTILIZE EXCESS FOREIGN CURRENCIES IN PLACE OF APPROPRIATED U.S. DOLLARS. THEREFORE, THE EMBASSY AT CAIRO IS AUTHORIZED TO PAY NESCO, AS WELL AS OTHER NATIONALIZED SHIPPING COMPANIES IN THE UNITED ARAB REPUBLIC, THEIR PORTION OF THE CHARGES IN EGYPTIAN POUNDS FOR TRANSPORTATION SERVICES PRIOR TO FINAL DELIVERY. SUCH AUTHORIZATION SHALL BE SUBJECT TO THE FOLLOWING PROCEDURES WHICH HAVE BEEN DESIGNED TO PROTECT THE GOVERNMENT AGAINST ERRONEOUS OR DUPLICATE PAYMENTS:

ON SHIPMENTS OF HOUSEHOLD EFFECTS FROM THE UNITED ARAB REPUBLIC, DESTINED TO THE UNITED STATES OR TO OTHER FOREIGN COUNTRIES, THE EMBASSY AT CAIRO WILL CONTINUE TO PREPARE THE GOVERNMENT BILLS OF LADING TO SHOW DEAN (OR OTHER AUTHORIZED U.S. FREIGHT FORWARDER OR HOUSEHOLD GOODS TRANSPORTER) AS THE LINE-HAUL CARRIER TO WHOM SUCH SHIPMENTS ARE TENDERED. UPON RECEIPT OF ITS AGENT'S INVOICE (AS IN THE CASE OF NESCO'S INVOICE NO. 20173, DATED OCTOBER 12, 1964, ATTACHED TO DEAN'S BILL NO. 790 9042 64, D.O. VOUCHER NO. 4495), DEAN IS AUTHORIZED TO SUBMIT TO THE EMBASSY A BILLING WITH NESCO DESIGNATED THEREON TO RECEIVE PAYMENT (PAYABLE IN EGYPTIAN POUNDS) IN THE NAME OF DEAN FOR PACKING, CRATING, CUSTOMS FORMALITIES, WAREHOUSE FEES, LOCAL DRAYAGE, OCEAN FREIGHT, AND OTHER RELATED CHARGES AS COVERED BY NESCO'S INVOICE. THE CHECKS SHOULD BE DRAWN TO SHOW THE NAME OF THE PAYEE AS DEAN EXPORT INTERNATIONAL, LTD. (OR OTHER SIMILAR CARRIER), IN CARE OF NEAR EAST SUPERINTENDING CO., ITS AGENT, AND DELIVERED TO THE LATTER SO AS TO AVOID ANY INFERENCE THAT WE ARE PAYING OTHER THAN THE LAST CARRIER OR ITS AGENT AUTHORIZED BY IT TO RECEIVE SUCH PAYMENT.

DEAN'S BILLINGS ON BEHALF OF NESCO WILL NOT BE PROPER FOR PAYMENT (WHERE PREPAID OCEAN FREIGHT IS INVOLVED) UNTIL SUCH TIME AS THE OCEAN TRANSPORTATION HAS BEEN COMPLETED AND DEAN OR ITS AGENT HAS TAKEN POSSESSION OF THE GOODS AT THE PORT OF ENTRY. WE REQUIRE THAT THE VOUCHER FOR NESCO'S CHARGES BEAR REFERENCE TO THE ORIGINAL GOVERNMENT BILL OF LADING NUMBER AND BE SUPPORTED BY NESCO'S ORIGINAL INVOICE AND ANY OTHER RELATED DOCUMENTS REQUIRED TO SUPPORT THE CHARGES COVERED BY THE INVOICE.

LATER, AFTER THE ORIGINAL GOVERNMENT BILL OF LADING HAS BEEN PROPERLY ACCOMPLISHED BY THE CONSIGNEE, DEAN CAN BILL THE EMBASSY FOR THE BALANCE OF THE CHARGES CONSIDERED DUE. THIS VOUCHER, SUPPORTED BY THE ORIGINAL GOVERNMENT BILL OF LADING, SHOULD SHOW THE TOTAL THROUGH CHARGES, LESS THE AMOUNT PREVIOUSLY PAID IN ORDER TO SHOW THE NET AMOUNT REMAINING TO BE PAID, AND THIS NET AMOUNT WOULD BE PAYABLE IN U.S. DOLLARS.

THE EMBASSY SHOULD MAINTAIN A RECORD OF PAYMENTS MADE AGAINST EACH BILL OF LADING AND RECORD ON THE VOUCHER CONTAINING THE ORIGINAL GOVERNMENT BILL OF LADING, A CITATION TO THE PAYMENT RECORD COVERING NESCO'S PORTION OF THE CHARGES. THERE WILL BE NO CHANGE IN PROCEDURES RELATING TO THE HANDLING OF SUPPLEMENTAL BILLS INVOLVING STORAGE-IN TRANSIT AND OTHER RELATED SERVICES AT DESTINATION AFTER PAYMENT HAS BEEN MADE ON THE VOUCHER BEARING THE ORIGINAL BILL OF LADING.

USE OF THE PROCEDURES IS SUBJECT TO THE RECEIPT BY THE EMBASSY AT CAIRO, COPY OF WHICH SHOULD BE FURNISHED THIS OFFICE, OF A WRITTEN CONFIRMATION FROM DEAN (OR OTHER AUTHORIZED CARRIERS) AGREEING TO BILL IN ACCORDANCE WITH THE PROCEDURES SPECIFIED AND TO ASSUME FULL CARRIER LIABILITY FOR ANY SHIPMENTS MADE UNDER THESE ARRANGEMENTS.