The amount of goods transported by sea is staggering. It is therefore vital to supervise the movement of all parties involved in maritime traffic. In order to carry out the transport, whether by truck, vehicle or sea, permits are required that identify the owner of the goods and the consignee. This is where the Bill of Lading comes into play in maritime transport.
If these controls were not in place we would not be able, given the volume of movements, to receive and ship products on time and in the right direction. We also have to take into account that these huge ships cross the waters of multiple countries : We cannot skip any protocol or law. That is why it is important, in addition to having a partner like Nissin Transport GmbH Sucursal en España that can advise you, to understand the importance of the Bill of Lading and how this document works.
What is Bill of Lading?
Every sea cargo voyage must be tracked with a defined sender and receiver. The Bill of Lading fulfills this crucial function. It acts as an essential international document for the transport of cargo by sea. Mandatory for the process, this document identifies the cargo holder and establishes the connection between the carrier and the final consignee.
Once the goods are on board the vessel, the carrier, the master or the carrier’s agent must deliver a Bill of Lading, which documents the right to the restitution of those goods at the port of destination.
The document must be clear, specific and precise, including detailed information such as details of the carrier, the consignee or the description of the goods, as well as the ports of loading and unloading, among other relevant data. In later sections, we will elaborate on the specific components of this document.
Its importance is such that it is considered the master document of international trade. A ‘master key’ for the movement of containerized cargo. Its fame is justified. This document is necessary to carry out any element or process involved in the logistics chain. Although it is commonly known as Bill of Lading, the term is often abbreviated to BL, B/L or BOL. However, it could also be called a ‘boarding pass’ if we compare it to a flight. Only in this case it refers to the shipment of goods rather than traveling passengers.
What does the Bill of Lading cover?
In short, the Bill of Lading contains all the information about the receipt of a specific commodity going from a point of origin to a destination. It serves as evidence to confirm that the shipper has transferred the cargo to the carrier or its agent under the agreed conditions. Therefore, it is necessary for this document to answer certain questions: what, who, why, how and when.
For this reason, the document always includes specific figures that are involved in the transportation process and that it will be mandatory to point them out in all shipments. However, for greater precision, it is convenient to mention the information that should always be reflected in a Bill of Lading (BL):
– Description of transported goods and tariff code, with special mention of hazardous cargo. Each container shall be considered as a unit.
– Seller (exporter) and consignee (if the bill of lading is nominative).
– Ports of loading and unloading of goods.
– The data of the carrier and its Agent at destination.
– The notify with the importer’s or his Agent’s contact information.
The Bill of Lading serves as a receipt for the goods and as a title of ownership of the goods.
When is it used?
The Bill of Lading has certain key functions, which are those we have already discussed. However, since it is a document that facilitates the arrival of the requested cargo at customs in the destination country, it should be used on more than one occasion:
Key functions
- To serve as proof of shipment and to record the condition of the goods as soon as they leave for their port of destination. The vessel, of course, must be the one agreed upon by the seller and the buyer.
- If customs and insurance formalities are to be carried out or if it is necessary to prove compliance with the contract of carriage (in Incoterms such as CFR and FOB), the Bill of Lading will be the document to be shown. It should be noted that liability would be transferred on board.
- It also serves as proof of the execution of the transport. The BL shows the items delivered to the carrier for shipment by sea. On the back of the document we will be able to consult the conditions of the maritime transport.
- The Bill of Lading (BL) facilitates the consignee’s request for release of the goods, as it functions as title of ownership of the cargo. It can be issued as bearer, nominative or to order, which significantly simplifies the transfer of ownership.
- It could function as a title of credit for banks in letters of credit. This document is capable of authorizing transportation charges and credits and allows the legitimate owner to withdraw merchandise.
- Although rarely, in necessary cases, the Bill of Lading can be used as a guarantee of payment. This measure prevents the consignee from accessing the goods before payment is made, thus protecting the sender, who may withhold delivery of the goods until payment for the value of the goods is received, as agreed.
Requirements for issue
The number of actions that the Bill of Lading allows to perform makes it necessary to follow very strict rules to be able to issue it. The first one is that you must always have 3 originals and several copies. Once the goods are on board the vessel, the carrier, the master or the carrier’s agent must give the shipper a bill of lading, which documents the right to the restitution of the goods at the port of destination.
The consignee, i.e. the person who will receive the cargo at the agreed port, will have to present the 3 originals mentioned above, or 1 of them endorsed if he/she wants to pick up the goods.
Finally, it will be the exporters or their agents who must physically deliver the original Bill of Lading to the importers. This process can be done by courier, through a bank or after the arrival of the vessel at destination. The important thing is that the consignee picks up the goods at the port of destination without any problem.
Figures involved
We have previously mentioned that a Bill of Lading involves several figures, all of which are involved in the logistics process of a cargo vessel. Let’s see more specifically what they are:
The Shipper
The first component to mention is, of course, the entity that ships the goods. Without the shipper there would be no shipment. This is usually the company making the sale, so it is often also referred to as the exporter. However, in some cases it may also be the importer of the goods itself.
The Consignee
If a shipment requires someone to send the product, it also requires someone to receive it. The consignee is the person or company with the necessary authorization to receive and withdraw merchandise once it arrives at its final destination. In the Bill of Lading the consignee is registered with this term and is usually the importer or the company that has acquired the goods.
The Notify
Sometimes, the owner of the cargo is not identified in the Bill of Lading (BL) as shipper or consignee. This is when the Notify comes into play. This person or company receives the notification that the goods have arrived at their destination. The consignee’s customs broker or freight forwarder is usually reflected as Notify.
The Carrier
This role is assumed by the entity responsible for the transportation of the cargo, which is usually the shipping line or its agent. It will normally be the shipping company who issues the BL (the carrier or the carrier’s agent). We will never get tired of reminding you that you must issue a minimum of 3 original copies of the Bill of Lading.
How to fill it in?
The Bill of Lading’s extensive problem-solving utility means that a great deal of information must be provided in detail. For this reason, the document contains more than 30 fields, which can lead to errors or omitted sections if not enough time is spent reviewing it. Despite this, the document is of utmost importance, as it is mandatory and facilitates both the shipment and receipt of goods.
In addition to facilitating the work of the other agents involved in the transport, the shipping company will enjoy the necessary security and peace of mind in its shipment. Therefore, if you need help with its completion, you can count on the services of Nissin Transport GmbH Sucursal en España. We have an end-to-end service in the supply chain. Our experienced team takes care of booking shipments, negotiating rates and preparing the necessary documentation so you don’t have to worry about a thing.
We have the most optimal routes to ensure the punctuality and integrity of your shipments. Our ocean freight service offers several options, such as LCL, FCL and conventional ship transportation, with the possibility of temperature-controlled containers for sensitive products. Our staff is well accustomed to dealing with shipments related to triangular operations and subject to letters of credit. If you need additional information or would like a quote for any of our services, please do not hesitate to contact our team. We are here to provide you with personalized advice and help you achieve your goals.
