BILL OF LADING


CONTENT OF THE BILL OF LADING


Introduction

It is remarkable that the law doesn't give a clear definition of the bill of lading or lays down the form in which it has to be drawn up.

A clear definition of the bill of lading is only to be found in Article 1, par. 7 of the Hamburg Rules, which were adopted on the 30th of March 1978 by the UN but which have been ratified by only 26 countries, most developing countries.

Steps have been taken by a number of international organisations (UN/ECE, International Chamber of Shipping - ICS and the International Chamber of Commerce - ICC) to standardize the international trade documents with regard to the size or format and the lining. For this purpose, the UN/ECE has drafted a model document called the "UN Layout Key" that can be used as a basic document or as a "master" to print other documents by means of self copying paper (Idem or NCE-paper), photocopier (xerox machine), printer and the like.

A closer look at the master document, the shipping permit, the mate's receipt, the quay service document, several bills of lading, shows us that the layout of each document is in many ways identical (at least for the top 2/3).

The law (Hague-Visby Rules, Article III, par. 3a, b and c) only gives the enumeration of the entries which have to appear on the bill of lading, so that it can  be considered as a full and negotiable document that entitles the holder to receive the goods.

In general, the bill of lading must state the nature and the quantity of the goods that must be carried, together with:

  • the name and place of residence of the shipper;
  • the name and place of residence of the consignee;
  • the name and place of residence of the master;
  • the name, nationality and tonnage of the ship;
  • the place of loading and discharge;
  • the stipulations relating to the freight;
  • the marks and numbers of the goods;
  • the number of copies delivered.
Article 3, par. 3a, b and c of the HVR requires that, among other things, the bill of lading shows:

the leading marks necessary for identification of the goods;

  • either the number of packages or pieces, or
  • the quantity, or weight, as the case may be, as furnished in writing by the shipper;
  • the apparent order and condition of the goods.

The words "to order" are usually entered in the box "Consignee" (See further, Issue of the bill of lading.)

In the box "Notify party/address" we find the person to whom the master (or the agent) has to address himself on the arrival of the ship to know who the receiver of the goods is. This box is only filled in, in case the bill of lading has been issued "to order". It remains empty if, in the box "Consignee", the name and place of residence of the receiver has been filled in.

The bills of lading which are used nowadays, don't mention the name and place of residence of the master anymore. The master is only obliged to sign the bill of lading. On the other hand, the bill of lading mentions in the top left corner the registered office of the carrier (owner, agency, forwarder). Further, the bill of lading mentions in the top right corner the bill of lading number (B/L No) and the Reference number i.e. the Customs Registered Number (CRN) from the shipper or from the forwarder.

Bills of lading for through transport, multimodal transport, or for combined transport also have boxes or spaces for: "Place of receipt" and "Place of delivery". These are inland places in which the carrier (the sea carrier as MTO or CTO, or the forwarder as MTO or CTO) receives the goods or respectively delivers the goods to the addressee. For combined transport, the bill of lading must also mention if it is non-negotiable as for instance with the "non-negotiable waybill". Further, the bill of lading show if it is an "Original" or a "Copy, non-negotiable".

For container transport a few additional mentions can be found such as:

  • Total number of containers/packages
  • Type of service (LCL/LCL, LCL/FCL, etc.)
  • Freight and charges (origin zone, Ocean sector)
  • Shipped on board vessel ...... plus date and signature or initials
  • (See further, Types of bills of lading.)

Shipped in Apparent Good Order and Condition

Most bills of lading have (usually on the bottom right) the clause "Shipped on board in apparent good order and condition ...". With this clause, the master acknowledges to have received the goods on board of his ship in apparent good order and condition. This is in agreement with the Hague-Visby Rules which states in Article III, par. 3c that only the apparent order and condition of the goods has to checked. The master shall consequently not open the boxes or open the packages to examine the content of the goods. He only has to check what he can perceive with his senses (e.g. what he can see or what he can smell).

For the carrier, this clause is very advantageous because he only has to deliver the same quantity of goods, in the same apparent condition, as determined during loading. The consignee will, of course, have to accept the goods as stated in the bill of lading and on producing it. In this way, the bill of lading is perfectly negotiable and it will allow the buyer to obtain a documentary credit.

Shipped and Received

There is a difference between a "Shipped bill of lading" and a "Received bill of lading". See "Documents in Connection with Sea Carriage - Received for Shipment" and "Bill of Lading - Definitions".

To obtain a Documentary Credit, a bank will only accept a "Shipped bill of lading" and not a "Received bill of lading". Bills of lading, which contain the mention "intended" with regard to the ship, the port of loading or of discharge will be refused, unless they show a "shipped" annotation together with the real port of loading and of discharge, unless the bill of lading gives a final destination place that is different to the port of discharge.

Since all bills of lading for combined transport bear the mention "Received by the carrier from the shipper in apparent good order and condition ..", the date of embarkation and the name of the shipper will have to be mentioned after the goods have been loaded: "Shipped on board on ... by ...." followed by the signature of the carrier or of his representative. See following document: Bill of lading for combined transport shipment or Port to port shipment.

Number of Copies

All bills of lading bear the following mention:

 "In witness whereof the Master or agent of the said vessel has signed the number of Bills of Lading indicated below all of this tenor and date, any one of which being accomplished the others shall be void." (CONGENBILL)

"In witness of the Contract herein contained the number of original stated opposite have been issued, one of which being accomplished the other (s) to be void." (Bill of Lading for combined transport shipment or port to port shipment.)

According to this texts, the bill of lading is issued in a number of originals of which one is sufficient to collect the goods and from the moment this has been done the others are of no value anymore.

In practice, the master or the agent from the carrier will only sign "one original"  that will be issued to the shipper, who delivered the goods to the master, in exchange for the bill of lading that he will mail to the receiver which will allow him to collect the goods. The master, the agent or the carrier will sign several copies of that original (usually two or three) which in fact boils down to the same original and which are destined for the shipper. Only these two or three originals bear the mention ORIGINAL and all other copies that may be issued such as a copy for the master, one for the consignee, one for the owner and other copies for other purposes bear the mention COPY NOT NEGOTIABLE. Sometimes, hundreds of these "copies not negotiable" are made but not one gives the right to collect or receive the goods.

To whom exactly the original bill of lading has to be handed over, depends on the terms of the contract of sale: FCA, CIP, FOB, CIF, et al, with or without documentary credit. For more details, see Documents Used by Outgoing Goods.

Full Set of Bills of Lading

The two or three (sometimes also four) original bills of lading which were handed over to the shipper is called the full set of bills of lading. If one person has the full set of bills of lading in his possession (on condition that more than one original was issued), it is impossible for another person to collect the goods.

In two situations, the full set of bills of lading can be demanded: viz. by the bank in case a documentary credit is granted and by the insurer in case of abandonment or by surrendering of rights.

The number of originals delivered is always mentioned on the bill of lading. In order to protect oneself against deceit,  e.g. if a person who is not entitled to hold an original bill of lading wants to collect or receive the goods, every bill of lading shows the following clause:

".... one of which being accomplished, the others shall be void".

Signing of the Bill of Lading

In practice, only the master signs the bill of lading. However, his signature is mostly replaced by the one of the agent whose signature will be followed by the words "as agent only".

To be allowed to sign the bills of lading in the master's name, the agent needs to have a power of attorney from the master. The master must, however, ensure himself that this power of attorney only is valid for the goods and the voyage in question.  For want of clear instructions from the master, the agent could misuse this power of attorney and use it for several voyages or for all shipments done by the same vessel.

 

                     Power of Attorney

 

I, Captain ............, master of the m/v .......­.... hereby give authority to Mr. .........., Agent at .................... to sign ..... Bills of Lading relating to the following goods: ........­....... loaded on my vessel on the ........... in the harbour of ........... and bound for ...............

 

Master.

The shipper doesn't sign the bill of lading. The bill of lading is consequently a contract that is signed by only one contracting party and that is so accepted by the other party.

"......In accepting this Bill of Lading the Merchant expressly accepts and agrees to all its stipulations on both pages, whether written, printed, stamped or otherwise incorporated, as fully as if they were all signed by the Merchant." (CONLINEBILL)

Date of the bill of lading

The law doesn't mention explicitly that the bill of lading has to be dated. Some national legislations prescribe that the bill of lading has to be signed within twenty four hours after completion of the loading.

The place and date of issue of the bill of lading can be very important because the allowance of a documentary credit often expires on a certain date. The date can also be important in case of import or export licences.

The master or the agent bears all responsibility for an anti or post dated bill of lading with all possible consequences .

Quick Reference

Check "UN Layout Key" to standardize the international trade documents such as the shipping permit, the mate's receipt, the quay service document, several bills of lading, etc.

The HVR enumerates the entries which have to appear on the B/L.

To order, is entered in the box Consignee.

Notify party/address shows who the receiver is.

The master is only obliged to sign the B/L.

For containers the B/L shows a few additional entries.

The master only has to check the apparent condition of the goods (with his senses).

There is a difference between a shipped Bill of Lading and a Received Bill of Lading.

The bill of lading is issued in a number of originals; only one has to be accomplished.

The full set of bills of lading represent all the originals given to the shipper.

Only the master or the agent signs the bill of lading. Be careful for the Power of Attorney.

Place and date of the bill of lading can be important in case of a documentary credit.

Useful WWW links

http://august1.com/lectures/ibl4/lect-11a/11toc.htm

http://www.forwarderlaw.com/feature/qualsta3.htm

http://www.jus.uio.no/lm/un.sea.carriage.hamburg.rules.1978/15

http://www.oas.org/dil/non-negotiable%20bill%20of%20lading-eng.pdf

http://www.state.ma.us/legis/laws/mgl/gl-108-toc.htm

http://www.state.ma.us/legis/laws/mgl/gl-106-7-toc.htm

http://www.labelmaster.com/images/pdfs/f265l.pdf

http://www.boglino.com/jameson/bol.htm

http://www.cyl-tec.com/lading.htm

http://customcritical.fedex.com/us/serviceinfo/documents/pdf/bolterms.pdf?link=4

http://www.transnet-rating.com/BOL.htm

http://www.shanedist.com/BOL.pdf

http://www.oocl.com/bl_terms/default.htm

http://www.roadway.com/services/reqdocs/cbol-nonfillable.pdf

http://www.oceanfreight.com/html/charterbl.html

http://www.myflorida.com/myflorida/business/learn/receivin.htm

http://www.microinput.com/html/Bill_of_lading.pdf

http://www.atlexpress.com/liner.htm

http://www.ocia.org/files/TC-F-004.rtf

http://www.averittexpress.com/doccenter/bolside2.pdf

http://www.export911.com/e911/ship/ship.htm#xCustoms

http://www.export911.com/e911/ship/ship.htm#xCustoms

http://www.midwestorganic.com/StraightBillofLading.pdf







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