Bills of lading are used to cover the transportation of goods by sea from a seller (shipper or exporter) to a buyer (consignee or importer). Under such an arrangement, the shipper will be concerned about getting paid for the goods when they arrive, while the consignee will be apprehensive of the condition of the goods when they arrive. In order to address these anxieties and to accommodate other issues, different types of bills of lading are issued, each showing the status of the goods at the time it is issued.
It is either one that shows the goods to have been shipped with a remark “shipped on board” or another that indicates that the goods have been received for shipment with the words “received for shipment”. When the status of the goods has been confirmed, the different types of bills of lading can then be differentiated.
The different types of bills of lading include the following:
Order Bills of Lading: These are bills of lading drawn up to the order of the shipper or a named bank. They are issued where the seller of the goods intends to retain ownership and title to the goods until he is sure that payment will be made.
Straight or Express Bills of Lading (Sea Waybills): These are also known as sea waybill, and are made out to named consignees without the words “order”. They are not negotiable documents and cannot be endorsed to third parties. Thus, they are not used by shippers who may want to retain ownership and transfer title. They are usually issued for personal and household goods, full container loads shipped from a freight forwarder to an associate company or for shipments belonging to the same company (parent and subsidiary) but in different countries.
Claused Bills of Lading: These types of bills also referred to as dirty bills, are those which show remarks by the carrier, concerning the goods, the packing or storage. For example, if at the time of receipt of the goods, they are found to be wet or stained, the carrier would remark on the bills of lading to reflect the condition under which they were received.
Clean Bills of Lading: Clean bills of lading are those which do not show any adverse remarks about the goods covered. Unlike the claused bills of lading, they do not carry any remarks about the goods, packing or storage.
Stale Bills of Lading: As the name suggests, stale bills of lading are those that are delivered to the buyer after the goods have arrived at the destination and which cannot contribute to facilitating their quick delivery. For every shipment, the buyer expects to receive the bill of lading before the goods arrive at the destination; otherwise, penalties may be imposed for delayed clearance at the port including storage charges.
Through Bills of Lading: These are bills of lading issued by the carrier to cover the transportation all through the journey up to the final destination of the goods. Thus, the bills of lading cover the goods even when other modes of transport are used. For example, a shipment from Fuzhou in China destined for Abuja, Nigeria to be trans-shipped in Colombo, Sri-Lanka would be covered by a through bill of lading issued for the whole journey. When issued, some carriers do not accept the risks from the port of discharge to the final destination even though freight includes the inland carriage cost.
Service Bills of Lading: Service bills of lading are issued where there is an agreement between carriers to carry goods on behalf of each other. Where a service bill is issued, the carrier who presents the goods is shown on the bills of lading as the shipper and consignee, while the notify party is shown as the agent or shipper at the port of discharge. The name of the actual consignee or particulars of the goods is not stated on the bill of lading.
Master Bills of Lading: As the name suggests, a master bill of lading is one which has control over other bills of lading. It covers a single shipment having several separate consignments for different shippers. It is usually issued to freight forwarders who act as carriers under an NVOCC arrangement.
House Bills of Lading: These are issued where the goods form part of a single consignment transported under a “Master “bill of lading. It is issued for the separate consignments that make up the full shipment. Freight forwarders acting as groupage operators collect goods from various shippers and transport them as one unit. They then issue separate house bills of lading to each of the shippers.
Lastly, Combined Transport Bills of Lading: These are very much like the “through bills of lading” which cover the goods from origin to destination. The difference between the two types is that the combined transport bill recognises that even though different modes are involved, only one set of conditions apply to the whole carriage. This type of bill of lading is common for shipments carried by Non-Vessel Operating Common Carriers (NVOCC).
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