Different Types of Bill of Lading

August 4, 2020

The bill of lading is one of the most important items in shipping. This legally binding document outlines the specific agreement between a shipper and a buyer, serving as both a receipt and a set of instructions. 

It’s important to note that there isn’t just one type of bill of lading. Many bill of lading types are available, depending on the arrangement that’s taking place. That way, you can pick the right bill of lading for the transaction at hand, making the process smoother for all parties.

With that in mind, let’s examine 13 of the most common bill of lading types to help you better decide which document to use in future transactions.

Definition of a Bill of Lading

The bill of lading is a fundamental document in shipping, often exchanged during shipment pickup. However, its significance extends beyond a simple receipt. This document is the linchpin of shipping logistics by legally documenting the transported goods, establishing the carrier’s accountability, and outlining the transportation agreement.

It provides crucial proof of shipment and, critically, can function as the document of title governing the transfer of ownership. A thorough understanding of the bill of lading’s intricacies is vital for ensuring efficient operations, mitigating potential conflicts, and maintaining effective oversight of valuable cargo.

Bill of Lading Types

1. Switch Bill of Lading

A switch bill of lading is a second bill of lading that a carrier issues to substitute for a previous one that’s already been distributed. It is for the same cargo, but it contains edited information that makes it different from the original document. As such, it isn’t possible to send a switch bill of lading when an original bill of lading is in effect. It’s a replacement document, so it must replace the original bill of lading.

You’d typically issue a switch bill of lading in a trade when there’s a change in trading conditions. For example, a switch bill of lading may come into the equation when goods are sold and the discharge port changes. Or it may come into play when the seller doesn’t want the consignee to know the name of the exporter.

2. Clean Bill of Lading

A clean bill of lading is just about the best thing an operator could ask for.

That’s because a clean bill of lading declares there was no damage or loss of goods during a shipment. A product carrier issues a clean bill of lading after inspecting a shipment. Essentially, this document declares a clean shipment—one that went off without a hitch.

3. Received for Shipment Bill of Lading

A carrier issues a bill of lading to prove the shipment was delivered. However, a bill of lading can be issued only after export customs are completed.

What’s more, a carrier may also issue a “received for shipment” bill of lading immediately after goods are received. The carrier typically distributes this document when cargo is loaded in a dry port and then transferred onto a ship.

4. Through Bill of Lading

In some cases—such as an international shipment—cargo will require extensive coverage. In these instances, it makes sense to distribute a through bill of lading.

A through bill of lading covers a shipment from its point of origin to its destination. You’d most likely distribute it when shipping items over international borders or when multimodal transportation is required to complete a shipment.

5. Clause Bill of Lading (or Dirty Bill of Lading or Foul Bill of Lading)

When a shipment arrives at its destination, the people there check the items against the specifications that the original bill of lading outlines.

When items become damaged or go missing, signing a clause bill of lading is important. This document states that the bill of lading did not deliver on its intended promise. It’s a legal, binding document that people sometimes refer to as a dirty bill of lading or a foul bill of lading.

6. Container Bill of Lading

A shipping party has the right to know what it’s transporting. For example, shippers want to make sure they aren’t transporting ill-gotten cargo or illegal products.

However, it’s not always easy to tell what’s in a load when items are in containers.

When this happens, the shipping party may request a container bill of lading. This document details the contents of individual containers.

7. House Bill of Lading (or Forwarder’s Bill of Lading)

Shipping parties often use non-vessel operating common carriers (NVOCCs), or freight forwarders, to transport goods.

NVOCCs will issue a document called a house bill of lading. This serves as an agreement between the shipping party and consignee, acknowledging the agreement of terms on which items are to be shipped.

The house bill of lading specifies the consignor and consignee at the port of destination. People also call this document the forwarder’s bill of lading.

8. Master Bill of Lading

A master bill of lading is similar to a house bill of lading, except a carrier issues it to the NVOCC or freight forwarder. This document is essentially a receipt for the transfer of items.

9. Charter Party Bill of Lading

The only time companies use a charter party bill of lading is when transporting items by sea.

In this case, a party must hire a vessel to charter goods to a destination. A charter party bill of lading is a receipt of goods between the party that charters the ship and the carrier.

10. Stale Bill of Lading

After receiving a bill of lading from a shipping carrier, an exporter must submit the bill of lading to its bank. This may be a negotiating bank, buyer’s bank, or supplier’s bank.

In most cases, there’s a grace period to ship the bill of lading. A bill submitted after the grace period ends (usually 21 days) is considered “stale” and is no longer accepted for payment. This is because it comes in after the goods reach their destination.

11. Straight Bill of Lading (or Consignment Bill of Lading)

A straight bill of lading—also called a consignment bill of lading—refers to a non-negotiable bill of lading.

In this case, a seller will agree to use a specific method of transportation, with an assigned consignee. A straight bill of lading will specify the exact goods being transported and spell out the way to ship them to a destination.

12. Bearer Bill of Lading

In some cases, a shipping party won’t specify an individual consignee at the port of destination. Instead, the shipper may opt to use a bearer bill of lading.

This document gives the shipper the legal power to endorse the bill of lading at their discretion. It also enables them to transmit the document to the buyer. When a buyer officially completes the transaction, this transfer results in a bearer bill of lading.

13. Surrender Bill of Lading

In an international shipment, an exporter must officially transfer ownership to an importer.

This is an important legal document, specifying exactly when items transfer to another party. The surrender bill of lading is a fast and efficient method of transferring ownership between parties.

Examples of Bill of Lading Uses

While the fundamental purpose remains the same, the format and level of detail can vary with bill of lading forms. Here, we’ll examine two prevalent examples: the standard bill of lading form and the short form BOL.

Standard Bill of Lading Form:

The standard bill of lading is often the most comprehensive version you’ll encounter. Think of it as a long-form agreement, meticulously outlining all the essential details of the shipment. This form typically includes fields for:

• Shipper and Consignee Information: Names and addresses of both the sender and the receiver.
• Carrier Details: The name and contact information of the transportation company.
• Description of Goods: A detailed account of the items being shipped, including quantity, weight, dimensions, and any special markings or handling instructions.  
• Packaging Details: Information about the type of packaging used (e.g., cartons, pallets, crates).
• Freight Charges: Specify the applicable rates, payment terms (prepaid or collect), and who is responsible for the charges.
• Place of Origin and Destination: Clearly stated locations where the shipment begins and ends its journey.  
• Date of Shipment: The date the goods were tendered to the carrier.
• Signatures: Spaces for the shipper and carrier representatives to acknowledge the receipt and condition of the goods.
• Terms and Conditions of Carriage: This section often contains detailed legal clauses outlining the responsibilities and liabilities of all parties involved in the transportation process.  

Due to its thoroughness, the standard BOL offers a high degree of clarity and legal protection. It leaves little room for ambiguity regarding the specifics of the shipment and the terms of the agreement. This makes it particularly useful for complex shipments, high-value goods, or dealings with new transportation partners.

Short Form BOL:

In contrast, the short form bill of lading, sometimes referred to as a simplified BOL, is a condensed version of its standard counterpart. It aims for efficiency by including only the most essential information required for transporting goods. While the exact format can vary between carriers, a short-form BOL generally includes:  

• Shipper and Consignee Information: Often abbreviated compared to the standard form.  
• Carrier Details: Usually, the carrier’s name.
• Description of Goods: A more concise description, potentially omitting some details found in the standard form.
• Quantity and Weight: These are typically included, as they are crucial for transportation and billing.
• Place of Origin and Destination: Essential for tracking the shipment.  
• Date of Shipment: Necessary for record-keeping.
• Reference Numbers: Often includes purchase order numbers or other internal tracking codes.  

A short-form BOL notably absents or significantly reduces the extensive terms and conditions of carriage. Using a short form, the shipper often agrees to incorporate the carrier’s standard terms and conditions by reference, which are usually outlined in a separate document or on the carrier’s website.  

The short-form BOL is favored for routine shipments, established relationships between shippers and carriers, and when speed and simplicity are prioritized. It reduces paperwork and streamlines the documentation process.

However, shippers must be familiar with the carrier’s standard terms and conditions when using a short-form BOL, as these terms will still govern the transportation agreement.

How You Can Streamline Bills of Lading

As you can see, the bill of lading is a critical document in any transaction. It’s vital to transmit it quickly and efficiently to prevent complications between shippers, receivers, and creditors.

Companies like Vector can streamline bill of lading collection using customizable mobile apps. With Vector’s help, shipping companies can reduce risk and ensure compliance at every step.

For more information on how Vector can help your organization with bills of lading, follow this link to find out how to customize your workflows.

This post was written by Justin Reynolds. Justin is a freelance writer who enjoys telling stories about how technology, science, and creativity can help workers be more productive. In his spare time, he likes seeing or playing live music, hiking, and traveling.