What is a Bill of Lading

Import, export business will usually involve bills of lading. The original bill of lading is the key document of title.

The Status of the Bill of Lading

A document in the form of a receipt; a bill of lading (BL) is issued by the office of a ship's master (the carrier) once goods have loaded for shipment. Its principal details are:

Date of loading the consignment
Quantities loaded
Condition of the consignment
Details of the intended recipient (consignee)

The carrier has a responsibility to ensure that the consignment is only to be released to the intended recipient, making the bill of lading a legal document of title.

Once goods have been shipped, the bill of lading will be included with other documents (e.g. invoice, packing list) which the onsignee accepts, usually by signing for them at there bank.

Without it the consignee cannot take possession of goods once they have arrived.

Is the Consignment Correct?

Although quantities and condition will be certified by the carrier, this will only relate to the perceived condition of the consignment.

For example if merchandise is being shipped it will be the number and condition of the cartons that is being advised, not their contents. For the rest the carrier relies on information supplied by the shipper and that will be made clear in the bill of lading.

The responsibilty for ensuring that the supplier of the goods is a reliable business partner remains yours therefore.

Original Bill of Lading

Documentary credits such as letters of credit or bills of exchange are a common feature of import / export trade.

If you are an importer and payment is to be made by either of these, an original bill of lading will be sent to your bank together with other documents relating to the shipment.

Once you have signed an authorisation paying or a commitment to pay for the goods (acceptance) the documents will be released to you. You are then able to use the bill of lading to take possession of the goods on their arrival at your home port.

It is important to note that only an original bill of lading will enable you to do this. A copy bill of lading will not be sufficient to enable the carrier to release the goods to you.

Alternatives to a Bill of Lading

Shipment of goods or merchandise by sea always calls for a bill of lading where documentary credits form part of the transaction.

If however that is not the case or if they are to be shipped by air a waybill substitutes or for shipment by road; a consignment note or trucking receipt.

Unlike a bill of lading a carrier can accept instructions to deliver the consignment to the intended recipient as stated in the waybill, without first confirming title to the goods by having the consignee produce a matching original before delivery can be made.

Corporation Tax and Marginal Relief From 2023 Deferred Income Explained What is a Monthly Cash Flow Forecast What is Pretax Profit How does a balance sheet balance? Lockdown Recovery: Forecasting Profits, Cash and Finance. How to Apply for Business Interruption Scheme with Figurewizard How to calculate liquidity and short-term liquidity How to calculate markup and margin The Truth about Monarch Airlines Labour's Spending over 10 years from 2000 How to make profits and not run out of cash Credit Checking - How to Read Micro or Short Form Accounts Amortisation of Arrangement Fees for Long Term Loans BHS Profits Performance 2010 - 2014 BHS profits, liquidity and cash flows 2009 - 2014 How to Calculate a Free Cash Flow Forecast Campari: How to apply for a bank business loan What are Current Liabilities What are Current Assets Late Payers and Cash Flow What is Operating Cash Flow? What is Working Capital How to Read a Balance Sheet Business Planning Cash Flow Calculator Short Term Liquidity Business Liquidity Corporation Tax is not Calculated on Net Profit Small Business Corporation Tax Cash Flow Calculator Using Figurewizard - VAT Using Figurewizard - Sales by Month Using Figurewizard - HP or Instalment Plan Budgets Using Figurewizard - How the budgeted cash flow forecast is calculated Using Figurewizard - Fixed Asset Budgets Using Figurewizard - Calculate Purchase of Goods Using Figurewizard - Forecasting Payments to Suppliers Using Figurewizard - How to Forecast Cash Collection Solvency and the Balance Sheet Property in the Balance Sheet Why Equity is a Liability Asset Management and Liquidity Selling Fixed Assets Contracts: Invitation to Treat What is Deferred Income Loss on the Sale of Fixed Assets Calculating Gross Profit Margin Profit and Loss Statement What is Operating Profit What is Net Operating Revenue What is Equity Profit on the Sale of Fixed Assets How Taxable Profit is Calculated What are Operating Overheads Overheads - Provisions How Depreciation is Calculated What is Business Operating Activity What are Fixed Assets Liquidity and Cash Flow Balance Sheet Liabilities and Leases Stock or Inventory Control What is Distressed Stock or Inventory What is Interest Suspense Account Product Safety Laws What is a Bill of Exchange What is Payment at Sight What is a Pro Forma Invoice What is a Bill of Lading What is a packing note What is Demurrage Cash Flow Forecasts and Planning Factoring: Invoice Discounting and Cash Flow How Does VAT Work Figurewizard as a Sales Aid for Factoring and Invoice Discounting