What is meant by warehouse receipt?

A warehouse receipt is a type of documentation used in the futures markets to guarantee the quantity and quality of a particular commodity being stored within an approved facility.

What are the common types of warehouse receipts?

There are two types of warehouse receipt, which are:

• Negotiable. This version specifies that the goods are deliverable to the bearer of the document, which means that they can be used as collateral for loans.
• Non-negotiable. This version specifies to whom the goods shall be delivered.

Is a warehouse receipt a document of title?

Warehouse receipts are also recognised as documents of title. To establish title to goods, a warehouse receipt must contain the particulars set out in section 11 of the Warehousing Act.

What is a warehouse receipt Philippines?

A: A written acknowledgment by the warehouseman that he has received and holds certain goods therein described in his warehouse for the person to whom the document is issued. The warehouse receipt has two-‐fold functions, that is, it is a contract and a receipt. (

How does a warehouse receipt system work?

The Warehouse Receipt System offers a solution. After harvesting, the farmer or trader can deposit a commodity in a certified warehouse and then be issued with a document of title called a warehouse receipt. WRS reduces the pressure on the farmer to sell immediately after a harvest when prices are normally low.

Why is warehouse receipt important?

A warehouse receipts system facilitates trading logistics. One of the key advantages of a warehouse receipt system is that it facilitates trade through easier liquidation of a commodity. Since warehouse receipts allow the transfer of right to ownership without actual physical delivery, transaction costs are reduced.

What is a negotiable warehouse receipt?

Negotiable warehouse receipt, which was launched in 2011, allows transfer of ownership of that commodity stored in a warehouse without having to deliver the physical commodity. These receipts are issued in negotiable form, making them eligible as collateral for loans.

How do you negotiate a title of a document?

For a document of title to be a negotiable one, it must indicate that the intention of it is that it should be passed on through commerce, with the words “to bearer” or “to the order of [somebody],” and it must be duly negotiated: signed off on by its previous holder (or without any signature needed if it was bearer …

Who can negotiate a warehouse receipt?

indorsement
Section 38. Negotiation of negotiable receipt by indorsement. A negotiable receipt may be negotiated by the indorsement of the person to whose order the goods are, by the terms of the receipt, deliverable. Such indorsement may be in blank, to bearer or to a specified person.

What is the function of a negotiable warehouse receipt?

Negotiable warehouse receipts allow transfer of ownership of that commodity stored in a warehouse without having to deliver the physical commodity. These receipts are issued in negotiable form, making them eligible as collateral for loans.

WHO issues a warehouse receipt?

authorized warehouse
Receipts must be issued by an authorized warehouse and must represent a commodity that is deemed to be stored commingled. The receipts must be negotiable and must represent a commodity that is the same quantity and quality as the eligible commodity actually in storage in the warehouse of the original deposit.

What are the benefits of warehouse receipt system?

WRS reduces the pressure on the farmer to sell immediately after a harvest when prices are normally low. While the commodity is in the warehouse, the depositor can monitor the prices and sell when it is favorable, often resulting in a 35-40 percent increase in price.

What is the legal definition of a warehouse receipt?

Warehouse Receipt Law and Legal Definition A warehouse receipt is a document showing that title to goods is stored with someone else. It is a receipt issued by a person engaged in the business of storing goods for a fee. Generally, a warehouse receipt is considered a document of title.

When do you need a dock and warehouse receipt?

Dock and Warehouse Receipts. Dock and warehouse receipts are forms that are used to verify the ownership of the merchandise being stored, sent, or received. After an individual or company drops of their goods at a warehouse or dock, they are given a receipt.

How are warehouse receipts used in the futures market?

A warehouse receipt is a type of documentation used in the futures markets to guarantee the quantity and quality of a particular commodity being stored within an approved facility. Warehouse receipts are a part of the operational business processing involved with futures contracts for physical delivery.

What happens if you default on a warehouse receipt?

If the borrower defaults, the lender takes over the warehouse receipt and can sell the goods to obtain payment of the loan. Non-negotiable. This version specifies to whom the goods shall be delivered. Warehouse receipts are commonly used for the storage of many kinds of commodities, such as precious metals.