5 Important Documents When Buying a Shipping Container in Kenya

Sometime in 2017, a close friend remarked “today, buying a shipping container is riskier than buying a car.” And boy was he right.

That same week, the Directorate of Criminal Investigations (DCI) had arrested individuals who had purchased used containers that lacked valid documentation.

The sellers were regular cons who had been defrauding unsuspecting container buyers within Nairobi.

And my friend’s words echo to this very day.

In any business transaction, documents are vital components.

Documents bind the buyer to the seller, show proof of payment, show proof of delivery, show transfer of ownership of the purchased entity, and etcetera.

Much like land, automobiles, and airplanes, shipping containers are identified with serial numbers unique to each single unit. But here is why containers are a lot riskier.

Every other day, these containers ferry different kinds of goods all over the world.

The goods could be in form of electronics, furniture, vehicles, clothing, chemicals, tools, weapons, cash currencies, and almost anything that can fit into that safe space.

By the time the container arrives at their destinations, history has been made. And since they have identification markings, they can be tracked anywhere on earth.

Therefore, issues arising from any single unit can advance some severe consequences if no proper documentation is adhered to.

These papers will legitimize your claim to ownership to a container unit.

Generally, if you are to safely acquire used containers in Kenya, you will need these five documents.

• A formal Quotation Note
• An Invoice
• An official Receipt
• A Logbook (container outward interchange)
• A Sale Agreement

Let’s dissect these vital documents one by one.

1. A Formal Quotation Note

This is a document that marks the start of the buying process.

A quotation note indicates the price amount of the container after initial conversation between a willing buyer and a willing seller.

Also, the note shows the quantity or number of shipping containers you wish to pay for.

But why must you have it? Why is a quotation note important?

These documents practically exhibit the identity of the seller as a registered and genuine entity within a given market environment.

It allows the buyer to scrutinize the legality of the supplier and decide whether or not to continue with the purchasing process.

Here, the buyer gets to analyze the indicated prices, dates, contact information, description of the equipment, quality and quantity, payment methods and etcetera.

You also get to compare and contrast information provided during your initial communication and on paper. This could be a start of a long-term association between two parties.

For an enterprise where value for money is priceless, you have to be accurate concerning the distributor.

Should any information be inaccurate or incorrect, that is enough to raise a red flag.

Therefore, the following information should be available in your quotation note at a minimum;

• Names of both the buyer and the seller (brand name in case the seller is a firm)
• Date of the preparation of the quotation
• Heading of the quotation describing the container being quoted
• Quantity and description of the measurements of the container
• Unit cost of the container
• Total cost of the container(s)
• Bank details via which the seller gets to make the payments
• Validity period during which the costs described are still applicable

Ladies and gentlemen, let’s just say it is the quotation note that will or will not determine the requisition of an invoice. Whatever the case, the beginning must be perfect.

2. An Official Invoice

So, you’ve found a suitable lady, studied her and are looking to settle. And then you think to yourself, mmmmh, she is worth every penny, so let’s pay this bride price and be done with!

So after you fall in love with a girl, you are going to want to keep her for yourself. And to keep her, you are going to want to pay her dowry or bride price.

And so, you make the step to inform her family that you are willing to move forward.

In the world of shipping containers, this is where the invoice comes into action.

The invoice is simply a reply to the quotation note.

It is the piece of paper you ask for after the quotation.

And, by asking for an invoice, you are simply saying, “I agree to the T&Cs and I am willing to purchase.”

On the other hand, a distributor who provides you with an invoice simply suggests they are willing to do business with you.

Remember suppliers reserve the right to choose whomever they sell their goods to.

In a legal invoice, you will find important information such as the name and logo of the company/seller, date, title, contact information, quantity and or quality of the items, invoice number as well as total cost.

It will also bear a validity period within which the terms and conditions of the deal remain applicable.

A valid invoice should basically contain;

• Date of the preparation of the invoice
• Names of both the buyer and the seller (brand name in case the seller is a company)
• The serial number of the invoice
• Heading of the invoice describing the container being quoted
• Quantity and description of the measurements of the container
• Unit cost of the container
• Total cost of the container(s)
• Bank details via which the seller gets to make the payments
• Validity period during which the costs described are still applicable

The moment you receive one, it is upon you the purchaser to visit the nearest bank, make payment and claim ownership of the referenced container.

Once your payment is confirmed and all conditions have been met, you can then request for a receipt.

3. An Official Receipt

First of all, we have all experienced that tense moment that grips us every time we spend money.

This is more so when procuring shipping containers where payment must be made before the equipment is collected to your site.

Remember also that cons circle this industry seeking loopholes and aiming to strike.

Whenever money changes hands, especially cases involving hundreds of thousands of currencies, and particularly in first time dealings, anxiety is as real as the sunrise.

What if the item has legal issues? What if the seller is a con? What if we have been duped?

Such “what ifs”, sneak into the minds of buyers when paying for shipping containers. It is perfectly understandable to develop fears.

However, there is hope.

Today, long before you receive a formal receipt, a genuine vendor will communicate to confirm receipt of payment the moment the funds hit their accounts.

This could be through phone calls, text messaging, email, or communication via WhatsApp.

In fact, in cases where immediate bank transfers are conducted, via RTGS for instance, you can request a photo image of a formal receipt shared to your WhatsApp profile. Yes, it can be that fast.

These methods of exchanging information have come in handy these last few years. In a receipt, the following information should be available at the minimum;

• Date on which the firm receives payment
• The serial number of the receipt
• Names of both the buyer and the seller (brand name in case the seller is a firm)
• Contact details of the seller
• The amount and currency transacted to the seller both in words and in figures
• Quantity and description of the measurements of the container being purchased
• Total cost of the container(s)
• Signature and stamp details of the seller

No firm will issue a receipt until you have made the payments, either partially or fully.

With a receipt in place, you can now obtain the rest of the accompanying documents.

4. A Container Logbook or Outward Interchange

Where lands have title deeds and humans have ID cards, vehicles and freight containers bear logbooks (also commonly referred to as container outward interchange).

In principle, logbooks are genuine and legal proofs of possession as well as records of events as pertains a given entity.

It is with a logbook that you officially register as owner of that container you’ve recently obtained.

You may recall from this previous post that each and every single freight container has a serial number located on various sections.

This is an identity from the shipping line that enables tracking of the container throughout the world.

Essentially, a cargo container logbook bears, among other information, the following;

• The brand name and logo of the interchange agency or distributor
• The date of interchange or distribution
• The container loading number
• The container serial number
• The type and size of the container
• Name and ID card number of the primary interchange personnel/driver
• The plate number of the transporting vehicle

Remember that the logbook is the primary document and to verify its authenticity, make sure that its serial numbers match the serial number on the container’s number plate.

It is the heartbeat of the equipment.

5. A Formal Sale Agreement

Documents are for protection.

And a sale agreement is one of the papers that protect the buyer and the seller in equal measure.

After you purchase a container, you will need to conclude its transfer into your ownership.

It binds the buyer to the vendor and specifies the terms and conditions of the transfer of ownership. You can think of a sale agreement as a kind of marriage certificate. 

Here, you agree to buy and the supplier agrees to sell, so you come together to complete the buying and selling process.

This paper, alongside a logbook also complete the chain of documents involved in purchasing shipping containers.

Whoever possesses these two legitimately stands out as the owner of the equipment.

Also note that should any legal or formal concerns develop regarding a particular container; the sale agreement points the direction from which the container arrived.

Here, this document becomes your get-out-of-jail card since the supplier assumes the position of the transferee.

In a sale agreement when buying a shipping container, you will find, among other information, the following;

• Date of the transfer of ownership
• Names of both the buyer and the seller
• Identity card numbers of both the buyer and the seller. In cases where the seller is an organization, its registration number is used.
• Physical address of the vendor. This is the physical location of the supplier that can be referenced whenever documentation for your equipment is required.
• Postal address of both the buyer and the seller
• Names and signatures of third parties who are present during the transfer of ownership of the container

Bonus Tip If You are Buying a Shipping Container from an Individual

In your quest to purchase a shipping container in Kenya, you might come across individuals offering to sell their personal containers as independent sellers.

From our experience in the industry, we always advice buyers to avoid such kinds of transactions because they almost always end up badly.

These types of purchases are the con’s paradise since there is very little formalities and most of the time the client is taken advantage of because of their naivety.

We have heard numerous cases where people have been sold non-existent containers or containers belonging to someone else.

It is safer to transact with a company that has a physical location so that you can be sure that incase of any concerns, you can always find them and resolve your issues amicably.

But that doesn’t mean that you cannot have a successful purchase from an individual.

If you really feel that you need to go that route, make sure you have a sales agreement with the buyer, and insist on a Bill of Lading document as a proof of ownership.

A bill of lading is usually generated from the container’s shipping line to an individual receiving the container as his property.

If still in doubt, contact us here at Premium containers so that you can avoid the stressful drama that may end up in premium tears.

Closing Remarks

They say victory is sweetest when it is hard earned.

And much like you would go to great lengths to ensure that car or that piece of land you are paying for is genuine, you must also do the same when procuring a container.

We insist that you do not take the easy way out, however tasty it may appear because in many a case, the sweetest tastes have landed people in unimaginable trouble.

Our biggest concern presently is the number of cons that are providing fake documents and landing customers in legal predicaments.

Others are losing hard-earned funds. Yes, it is that serious! You don’t believe it? Just peruse trough DCI Kenya’s social media pages.

Do not try to be too clever. Because like the Bible states, no one knows the day nor the hour…

We have walked you through the steps you will need to obtain this equipment.

It is our hope that you can follow them.

We really value your safety because as our customer, you mean everything to us.

Stay safe and take care.

Cheers!