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Bills of lading are transport documents that, in general, cover movement by sea or where the major portion of the total distance covered is by sea. Unlike other transport documents Bills of Lading are ‘documents of title’, i.e. they are the prime evidence of who has title to the goods covered by the document. Bills of Lading are issued in ‘sets’ of numbered originals (e.g. 1/3, 2/3, 3/3). The sets can be made up of any number of originals but 2 or 3 are the most usual. The Bills can be made out as follows:- to the order of the shipper (the exporter); to the order of a named party; to a named party. In order for the Bills of Lading be ‘negotiable’, they require signed endorsement by the party to whom they were made out ‘to the order of’. Endorsement can be either ‘blank’ or to the order of another named party. Blank endorsement means that whoever has possession of one or more of the endorsed original bills can claim title to the goods. For this reason such Bills of Lading need to be kept secure and forwarded by a secure method. Bills of Lading that are consigned to a named party (i.e. not ‘to the order of’ a named party’) are known as ‘straight consigned’. In most countries this means that only the party named can collect the goods and the Bills of Lading cannot be endorsed over to any other party.
Marine or Ocean Bills of Lading are, as the name implies, bills covering shipment by sea. Marine Bills of Lading can be issued by the shipping company (carriers), the captain or master of the vessel, or a party acting as agents for the carrier.
A Received for Shipment Bill of Lading is one that merely evidences receipt of the goods by the issuer. It does not, therefore, evidence that the goods are en route. Most Bills of Lading are issued as ‘Received for Shipment’ bills. The date of the document is the date on which the issuer accepts responsibility for the goods.
Shipped on Board Bills of Lading are bills that evidence, either in the wording of the document itself or by means of a signed and dated annotation to the document, the date on which the goods were loaded on board the vessel. By their nature these are accepted as evidence that the goods are actually en route.
Short Form Bills of Lading: Most Bills of Lading will show the full terms and conditions of carriage on the reverse of the document. A Bill of Lading that only makes reference to the terms and conditions of carriage by referring the holder to another document or set of conditions is known as a ‘Short Form Bill of Lading’. The only thing of note about these is that they are unacceptable under Documentary Letters of Credit, unless specifically authorised.
Where not all of the journey on which the goods are being taken by the carrier is by sea, the carrier will usually issue a Combined Transport Bill of Lading. This covers the full journey from place of receipt of the goods by the carrier to the place where the carrier will relinquish responsibility for the goods. The Bill of Lading will cover whatever means of transport is used on the journey but the majority of the journey will be by sea. Combined Transport Bills of Lading are extensively used in connection with container shipments and are, consequently, the most common forms of Bills of Lading that the average exporter is likely to see.
House Bills of Lading are Bills of Lading issued by a freight forwarder and not the actual carrier. The freight forwarder will have possession of the Bill of Lading issued by the carriers and will then issue his own Bills of Lading to cover the various goods that make up the total ‘groupage shipment’ made up by them. Unless these types of bills are signed, by the issuer, ’as carrier’ or ‘as agents for a named carrier (or named master of the vessel)’, they are unacceptable for presentation under a Documentary Letter of Credit.
A Sea Waybill covers the transport of goods by sea but, unlike a Bill of Lading, it is not a ‘document of title’ and is merely evidence that the carrier has taken over the goods for transportation. It is, in effect, a receipt for the goods, showing the details of the agreed shipping arrangement, i.e. the route, vessel, goods description etc.
Air Waybills cover, as the name states, shipment of goods by air. They are evidence of receipt of the goods by the carrier/forwarding agent and are not evidence of title to the goods. Air Waybills issued by a Forwarding Agent are known as House Air Waybills (unless they are signed ‘as carriers or ‘agents for a (named) carrier’). Unless specifically authorised, House Air Waybills are not acceptable for presentation under a Documentary Letter of Credit.
Road Consignment Notes evidence transport by road. They are, usually used for goods that are destined for mainland Europe and the near Middle East. As with all other types of transport document, except Bills of Lading, they are evidence of receipt of the goods by the carrier. The most widely seen Road Consignment Note is the ‘CMR Note’.
As the name suggests it covers shipment by rail. It is rarely used in this country, with regard to international transactions, as most of the traffic taken by rail to the continent is loaded upon lorries anyway. These documents are more likely to be used on transcontinental shipments.
This item is self explanatory and requires no further explanation.
