What is a bill of lading?

A Bill of Lading is a document issued by a Carrier to a Shipper, confirming goods were received in an acceptable condition and are ready to be shipped and delivered to the consignee.

Carrier is a person who performs or undertakes to perform for hire, the carriage or part thereof, of goods by road, rail, inland waterways, sea or air.

Shipper is the name and address of the one whose cargo is being shipped.He is also known as consignor. It is not necessarily the owner or manufacturer of the cargo but also can be an exporter/supplier or freight forwarder.  

Consignee is the name and address of the one who is receiving the cargo. It may be the actual owner or recipient or maybe a trader, an importer, or a freight forwarder or the arrival agent that is handling shipment received.

A bill of lading is a legal document that serves three vital purposes in the shipping process: as a receipt for shipping, as a title of goods, and as a contract of carriage. It’s a legal agreement that’s enforceable by law.

Many people confused with bill of lading to shipping bill. Shipping bill is entirely different document . To know more about shipping bill read “What is a shipping bill?“

A bill of lading indicates a particular carrier through which the goods have been placed to their final destination and the conditions for transporting the shipment to its final destination. Land, ocean and air are the means used for bills of lading. The bill also mentions the party that is paying the freight, whether it is collects or prepaid (either the buyer or seller). The content of shipment, type of inner packaging, type of outer packaging is also available in the bill of lading. Freight & Charges, Date on Board, Date of Issue, Place of Issue, Number of Originals,    and Carriers Agent are included in the BL.

The shipper submits bill of lading with other documents to his bank to be sent to importer’s bank. On receipt of communication from his bank the importer collects bill of lading and other required documents from his bank and arranges for import customs clearance procedures.Normally, the cargo must be released with the original bills of lading for delivery at final destination. However, the shipper (exporter) can surrender original bill of lading (OBL) at load port where Bill of Lading has been released and arranges to send an OBL release message to the counterpart office of sea carrier and advise them to release cargo without insisting for original bill of lading from consignee.

In case of shipment through airways, the transit time is too less compared to sea shipment. Therefore, a set of airway bill is sent along with the cargo for immediate reference on transit and for import customs clearance at destination port by importer. Hence, original airway bills are issued in quintuplicate which is meant for carrier, importer, shipper and additional copies. The importer or his cargo agent approaches the destination office of air carrier once  the arrival of cargo to destination and collect airway bill and other required documents sent by shipper along with cargo for necessary documentation for import customs clearance procedures and other references. Importer may also collect copies of documents by courier or mail from shipper before arrival of goods.

The other details available in the bill of lading:

Notify Party: Someone whose name and address to be notified on the arrival of the cargo at the destination. It might be different from the Consignee depending on the Bill of Lading.    Pre-Carriage by: If there is an inland port connecting the mainland port via a vessel, then that vessel’s name is shown here. Most times, it remains blank.

Place of Receipt: The movement of the cargo from this place to the port of loading. In case of damage during this transit, the carrier bears the liability.

Port of Loading: This is the place where the carrier loads the cargo on the designated ocean vessel.

Ocean Vessel/Voyage: This contains the vessel name and the voyage number.

Port of Discharge: It is the place where the cargo is being discharged by the ocean vessel.

Place of Delivery: This is the place where the cargo’s final delivery is to be done. If the place of delivery is written on BL, then the carrier can not allow the consignee to take the delivery at the port of discharge to transport it to the place of delivery.

Marks & Numbers: The packages are marked with some unique identifiers by the shippers so that the consignee can understand the type of cargo.

Booking Number and Bill of Lading Number: A unique number given to each B/L for easy tracking and tracing of the container.

The multimodal Transportation of Goods Act, 1993 (MMTG) provides for the regulation of Multimodal Transportation of Goods from any place in India to any place outside India involving two or more modes of transport on the basis of a single Multimodal Transport Contract. Under the above act, “delivery” means,—

(i) in the case of a negotiable multimodal transport document, delivering of the consignment to, or placing the consignment at the disposal of, the consignee or any other person entitled to receive it;

(ii) in the case of a non-negotiable multimodal transport document, delivering of the consignment to, or placing the consignment at the disposal of, the consignee or any person authorised by the consignee to accept delivery of the consignment on his behalf;

(iii) “Endorsee” means the person in whose favour an endorsement is made, and in the case of successive endorsements, the person in whose favour the last endorsement is made;

(iv) “Endorsement” means the signing by the consignee or the endorsee after adding a direction on a negotiable multimodal transport document to pass the property in the goods mentioned in such document to a specified person.

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