Posted on Leave a comment

Bill of Lading

Bill of Ladings:

  1. A Bill of Lading, abbreviated as B/L is a document issued by a carrier (or an agent, acting on behalf of the ship owner) to acknowledge receipt of a shipment of cargo. 
  2. Under the terms of many carter parties and some voyage charter parties, the owner transfer the authority to sign the BL’s to the charterers or charterer’s delegated agent thereof, thereby acting as an agent of the ship-owner.
  3. Master should confirm with the Charter party agreement in understanding who is authorised to sign the BL. If doubt exists, he should clarify the specific instructions from the owners & time charterers.
  4. If the charter’s agents is authorised to sign the BL on behalf of Master then the Master should issue a Letter of authorization to the Charterer’s agent. The wordings of such authorization often dictated by the owner’s or chaterer’s voyage instruction.
  5. A bill of lading is a negotiable document and serves three main functions:-
    • It is a conclusive receipt i.e. an acknowledgement that the goods have been loaded.
    • It contains or evidences, the terms of contract of carriage entered between the “carrier” & the “shipper” in order to carry out the transportation of cargo as per sales contract entered between buyer & seller.
    • It serves as document of title to the goods.

(Please Note:- The contract terms evidence by a bill of lading are usually governed by the Hague Rules, the Hague-Visby Rules or the Hamburg Rules).

Types of Bill of Ladings:

  1. Straight Bill of Lading:- When a B/L is issued in original(s) to a named “cosignee”, it is termed  as “Straight Bill of Lading”, which is a “Non-negotiable and non-transferable document.
  • Seaway B/L / Express Release:- When a B/L is issued to a “named cosignee” but without any originals, it may be considered to secure B/L. This B/L is also non-negotiable and non-transferrable document.

A Seaway Bill is issued:-

  • Where the Shipment takes place between two different companies but there are no negotiation required between the two, via a Bank for relase of cargo and also,
  • The shipper does not need to submit original B/L to procure his payment.
  • Negotiable or Order B/L:- When a B/L is issued in originals and cosigned to “to order” or “to order of shipper” it is termed as negotiable B/L or Order B/L.

Before signing Bill of Lading the Master must ensure that:-

  1. The goods are actually aboard and the Bill of Lading is correctly dated.
    • Please Note:- The B/L date must be date of completion of loading and not pre/past dated. Any issues arising thereby consult the owners and/ or comment operators.
  2. The description of goods complies with the mate’s receipt, failing which the bill of lading should be claused accordingly:
    • If cargo “quantity” or “quality” discrepancies exists, insist that remarks are placed on “Mate’s Receipt” and the same reflected on the original B/L’s.
    • If resisted by the agent to accept a claused B/L, the Master must issue a letter of protest, specifying the cargo quantities as per shore scale, ship’s draught survey quantity & attending surveyor’s quantities and cargo figure difference. Do not issue letter or Authorisation to the charterer’s agent and inform owners & time charterer’s accordingly.
  3. The Master should only sign the same number of original B/L’s as indicated on the face of the B/L.
    • If original B/L to be carried onboard, inform owners and/or commercial operator advising on the no. of originals to be signed and retained onboard.
  4. Check B/L format, especially for Frieght Clause. If “Frieight Prepaid” is written, immediately inform owners and/or commercial operators and seek instructions.
  5. If any cargo is shipped on deck, inform owners and/or commercial operators and time charterer and clause the B/L accordingly. “Carried on Deck, solely at Shipper’s Risk & Responsibility, carrier not responsible for loss or damage how so ever caused”.
  6. If the sufficient cargo is not supplied as per stowage plan and your cargo demand as indicated also in the N.O.R. the vessel must issue “Deadfreight Letter” and notify shippers charter’s and owner and the same to be annexed to the B/L.
  7. At the discharge port, the Masters authorises the release of cargo to co-signee or their agent, when presented with original B/L, duly endorsed by the cosignee or their agent.
  8. Only owners and/or commercial operators can authorise in writing to Master to release cargo W/O original B/L, while procuring a LOI charter’s to do so.
  9. After receiving original B/L at discharge port, ensure it is remarked “Accomplished” i.e. B/L is cancelled upon delivery of cargo to its owner.
    • Send copy of B/L immediately to the owner’s and Charterer’s advising its receipt and that you are releasing the cargo to the consignee.
Leave a Reply