There are many technical terms to be aware of when dealing with shipping containers or similar shipments, and the bill of lading is one of them. The document is extremely important and represents the main piece of paper for your logistics.
What is bill of lading, and what makes it stand out? As you dive deep into the world of logistics, this document is probably the first thing you need to learn about. It makes the difference between smooth transportation and a series of problems.
What is bill of lading?
A Bill of Lading is a document issued by the carrier to the shipper as evidence that cargo has been received. It is important because it acts as a receipt for the goods and it acts as a contract between the carrier and the shipper.
The document must be issued by the company transporting goods – the actual carrier. It is issued to the company supplying the goods – the shipper. The shipping company is also often referred to as a consignor in the logistics industry.
The document is thoroughly checked along with the goods. Its role is to confirm that goods were received in the optimal condition, in the right quantity, and are ready to go to the receiver, also known as a consignee.
The goods are then delivered and checked based on the bill of lading. To keep it simple, the bill of lading works like a contract between everyone – the shipper, consignee, and carrier. Apart from the actual goods, it also includes the terms and conditions associated with the shipment.
What is the bill of lading used for?
Now, what is bill of lading used for, and what makes it so important? There are online companies like Importdoor that help you search millions of records by product, shipper, buyer and other search criteria to find specific details for every shipment coming into the United Sates.
It is a legal document – it makes no difference what country you ship from or where you ship. This legally binding document can also be given as proof of ownership. Authorities will know who to contact if anything goes wrong with the shipment.
The bill of lading is also proof of ownership. Once the goods reach the destination, the consignee must bring in the bill of lading to secure the goods and have them released. Basically, the consignee will claim ownership.
It is worth noting that only the consignee listed on the bill of lading can claim ownership.
Finally, the bill of lading is also a guarantee for the shipper that payment will be received. Sometimes, shippers can keep such documents until the payment is received, meaning goods will not be released until the payment is made.
What does the bill of lading include?
The document is significant for all shipments; more importantly, it must be very accurate. Small mistakes – even innocent typos – can cause serious problems with claiming ownership.
First, the document should include details of everyone involved in transportation – who the goods come from, who the consignee is, and who the carrier company is. It will also include the location where goods were loaded and the actual destination.
The transportation mode is also included – such as sea or air. Terms and conditions associated with the shipment are also mentioned, not to mention a description of the package – how much it weighs, what it is classified as, etc.
General requirements for the bill of lading
There are certain requirements that must be met in order for a bill of lading to be considered valid.
First, the bill of lading must be signed by an authorized representative of the shipping company.
Second, the bill of lading must list all of the items being shipped, as well as the quantity of each item.
Third, the destination of the shipment must be listed on the bill of lading. Finally, all other pertinent information, such as insurance details or special instructions, must also be included on the bill of lading.
If you are interested in searching for millions of Bill of Lading and its contents, companies like ImportDoor can help you find what you are looking for whether that is products, supplier, wholesalers, importers, etc.
If a third party is involved – such as a broker or someone managing customs- they must also get a copy. Based on local laws and regulations, some companies need to keep these documents for a specific period– just in case they are questioned about the goods later.
What is bill of lading helpful for? The document is helpful for random controls and ownership claims. Suppose there is one aspect that is mandatory at all times on the bill of lading that is the consignee. One should never miss it from the document, or ownership cannot be claimed.
However, there are very rare exceptions when the consignee is not mentioned. Usually, the consignee can be removed if whoever gets the goods is not the receiving party but their nominated address or company.
Even if such situations occur, there should still be some details – the shipper order or the bank order.
Different types of bills of lading
There are three main types of bills of lading: straight, order, and negotiable.
A straight bill of lading is the most basic type of bill of lading. It spells out the details of the shipment, including the sender, recipient, and what is being shipped. This type of bill of lading does not give the recipient any special privileges or rights.
An order bill of lading gives the recipient certain privileges, such as the right to sell or transfer the goods. This type of bill of lading is often used when goods are being shipped on consignment.
A negotiable bill of lading can be sold or transferred to another party.
Conclusion
If you are new to logistics, it is essential to know what bill of lading is. You should understand that this document makes the difference between smooth transportation and many problems. The document covers the actual details of the shipment – who sends it, what it contains, and who is supposed to receive it.
At the same time, the legal document is also used to claim ownership once the goods arrive. Besides, based on where you live, you may need to keep it for years, just in case authorities find something suspicious and need to check your records.
