Over Shipment

Over Shipment refers to the seller's actual delivered quantity exceeding the quantity stipulated in the contract or letter of credit. In international trade, because bulk cargo (such as grain, ore, petroleum, etc.) is difficult to measure precisely, contracts or letters of credit usually stipulate a certain percentage More or Less Clause, allowing the delivered quantity to fluctuate within an increase or decrease range. If the allowed upper limit is exceeded, it constitutes over shipment. Over shipment may lead the buyer to reject the excess portion, request a price reduction, or incur additional costs (such as storage and insurance). Under letter of credit settlement, if the over shipment exceeds the range allowed by the letter of credit, the bank may refuse payment. In addition, over shipment is the opposite of short shipment, and the two are often combined as 'more or less shipment.' Note: The seller should deliver strictly according to the more or less clause range stipulated in the contract or letter of credit; if not stipulated, according to Article 30 of UCP600, even if an increase or decrease is not allowed, a 5% increase or decrease is permitted, provided the letter of credit amount is not exceeded. Difference: Over shipment emphasizes exceeding the stipulated quantity, while short shipment emphasizes being less than the stipulated quantity; a more or less clause is an agreement allowing both.