The Bill of Lading (“B/L”) is a negotiable document issued when goods are transported by sea. Being the B/L a negotiable instrument (represents the ownership of the goods) it may be endorsed and transferred to a third party during the transit of the goods between the port of departure and the port of arrival.
The B/L is issued by a carrier (or one of its agents) to shipper/exporter and is countersigned by the captain, an agent, or the owner of a vessel. The scope of this document is to confirm the receipt of the goods (cargo), to set the carriage contract conditions, and to confirm the commitment to deliver goods to the named port of destination to the physical holder of an original B/L. The entity or the person that holds the original bill can claim the delivery of the goods at the arrival port.
The B/L is a critical document for payments settled by letter of credit. When LC’s are involved in the transaction, the B/L has to be issued with specific wording and show precise indications (example free on board date, consignee and notify party name, name and address of local agents at arrival port, goods designation).
A bill of lading generally shows the following information:
- shipper name
- forwarder and vessels’ names
- quality and quantity of the goods (net and gross weight)
- free on board date
- ETD/ETA (estimated time of departure, estimated time of arrival)
- general terms of carriage and other contractual conditions
AIRWAY BILL OF LADING (AWB)
An Airway bill of lading (“AWB”) is a non-negotiable transportation document issued for air cargos. Being not negotiable, the AWB does not represent a title on the goods and cannot be used to transfer their ownership during the transit. The airway bill of lading simply states that the airline has loaded the goods and has the obligation to move them to the named destination airport.
AWB should indicate:
- a consignee (generally, the importer or the buyer)
- goods description (quantity and quality)
- any text required by documentary credits
MULTIMODAL BILL OF LADING (FBL)
A Multimodal Bill of Lading (“FBL”) is an international transportation document released to cover two or more modes of transport, such as shipping by road and then by railway or shipment by sea and then by road. FBL may be negotiable (when issued “to the order”) or non-negotiable (in most cases).
FBLs are issued by FIATA authorized forwarders/carriers either as shipping contract and as cargo receipt confirmation.