Bills of lading are important documents that serve as contracts, receipts and documents of title for exporters.
Exporters should use them with every export so they have evidence of a contract of carriage. If they aren’t used correctly, shipments could be delayed.
What Is the Ocean Bill of Lading?
The ocean bill of lading serves as both a contract for carriage and a document of title for cargo. It identifies the parties on both ends of the shipment, and describes the goods and routing instructions.
There are two categories of ocean bills of lading that reflect the terms and conditions of the sale of the goods:
The straight bill of lading is used when the shipment is consigned directly to the named consignee and no other party. Typically this type of consignment is used for open account or cash in advance transactions. The consignee takes possession of the goods upon arrival by presenting a signed original bill of lading to the carrier.
An ocean bill of lading consigned “to order” or “to order of shipper” is negotiable once it is endorsed on the back by the shipper or their representative. The endorsed original bill of lading is usually sent to the bank in the buyer’s country and held until the transaction is satisfied under a document collection, cash against documents, or a letter of credit. Once the endorsed original bill of lading and other required documents are in the hands of the buyer, the buyer can transfer the bill of lading.
An ocean bill of lading should include:
The name and contact information for the exporter, the ultimate consignee, forwarding agent, and the notify parties;
Vessel, booking and loading instructions for the international carriage of the goods;
A description of the goods including their weight and dimensions, the number and kinds of packages, any marks and numbers on those packages, and whether any of the goods are hazardous; and
Freight rates and charges.
If you complete your ocean bill of lading incorrectly, you could face delays in delivery and/or payment, denial of claims, incidental costs incurred through delays in delivery, and even penalties (which may apply for fraudulently completing the bill of lading form).
You can also be fined for incorrect documentation for hazardous materials or controlled goods. Rely on your in-house representatives and your partners to help answer questions about completing the forms, but realize that it’s ultimately your responsibility to know your classifications and licenses.
( Melissa )15 Jun,2018
