Bill of lading [full guide]: What is it & why it matters [+different types] (2024)

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Last Updated: October 13, 2023

Bill of Lading comes from an English term meaning ‘a list of cargo’. But in reality, it’s more than just a list. In this blog, you’ll get a comprehensive overview of a Bill of Lading, its importance in mitigating risks, and the different types of BoLs there are. By the end of this piece, you’ll also be up to date about the digitalization of BoLs and the emergence of electronic Bills of Lading (eBoLs) as a modern solution for container logistics.

For centuries, the Bill of Lading has been an indispensable tool in facilitating the exchange of goods between buyers and sellers, providing a reliable record of the cargo’s journey from its point of origin to its final destination. From ancient trade routes to the modern-day shipping industry, this document has adapted and evolved to meet the ever-changing needs of a dynamic global market.

In the complex realm of international trade and logistics, having all the necessary documents plays a crucial role in ensuring the seamless movement of goods across borders. However, it can get confusing if you don’t have everything in order. This is where Container xChange swoops in to help streamline your container operations.

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Table of Contents

What is a Bill of Lading (BoL)?

A bill of lading is a document used in freight shipping that states an agreement between a shipper and a carrier. It outlines the relationship between the two when cargo is transported. The bill of lading (BoL) acts as a shipment receipt which is signed by an authorized representative, namely the carrier, shipper or receiver. Though this document can be signed by all three parties, it’s the carrier, or the agent of the carrier who issues the BoL. Some people also refer to this document as a waybill, this term is mainly used in the US and Canada.

Bill of Lading: Importance and purpose

BoL is a crucial part of the shipment process. It’s a legally binding document that serves as:

A receipt for the goods received and delivered by the carrier
Evidence of a contract of carriage (transport)
A title for the goods in shipment

Once a BoL has been issued there are only 2 ways the cargo will be released:

Bill of Lading: How it works

Imagine you own a seafood restaurant in Hamburg. The upcoming holiday season requires you to get fresh fish and other seafood for your restaurant. You find a food vendor in Norway and raise a purchase order. Once the vendor procures your needs, he gets in touch with a logistics company for the shipment. The authorized representatives from both sides sign a BOL (carriage contract) before the logistic company sets sail.

The carrier delivers the consignment to your restaurant in a few days. Your restaurant manager inspects all the items once the shipment arrives to make sure all the items you’ve asked for are there. The payment is made to the vendor only once there’s a confirmation that everything is okay! You don’t want to get confused with what goes on this document, so let’s go into it in detail:

What’s on a Bill of Lading?

Having an understanding of what you can find on a Bol is essential as it saves time and keeps you informed. There are standard components that make up your bill of lading. You’ll notice that any BoL will have the following:

Name and address of the shipper
Name and address of the receiver
Purchase order or reference number
Date of pick-up
Order description of goods (number of units, dimension, nature of cargo, etc.)
Gross/net/tare weight
Details of packaging used (crates, pills, drums, etc.)
Any special note or instruction

The carrier fills out most of the information on the original Bill of Lading. It then falls on the shipper to provide up-to-date information to the carrier and ensure that every detail listed is accurate. Below, you’ll find a real example of a freight BoL:

Bill of lading example

Receipt for the goods

After the carrier receives the cargo from you to be shipped, it goes through inspection. After which, the carrier creates a BoL to you which is then handed over to you. All the details for the goods will be stated on the document and will serve as proof that they’re in good condition. From then on, the responsibility falls into the hands of the carrier to keep them safe and undamaged, otherwise they can be held liable for those damages. Shippers usually hold on to the original copy of the BoL until payment is made. This ensures that the consigneeWhat is a consignee? When transporting freight (by ocean, air, or land), there are two parties involved — one who is shipping and the other who is receiving the freight. The recipient of the goods b... More has access to their goods only after the payment, and when the BoL is released.

Evidence of a contract of carriage

This type of BoL essentially serves as evidence of a contract’s existence. It gives the carrier a record of how to handle the goods. The carrier gets the go-ahead to pick up the goods and deliver them to the final destination once this BoL is transmitted to the shipper. Without the BoL, you can’t carry out a shipment. It often serves as proof of ownership over the goods the carrier is carrying.

Title for the goods

“Title for the goods” signifies that the shipper has transferred the goods to the carrier, and the latter has temporary rights over the goods.

When the goods arrive at the final destination, the receiver (consigneeWhat is a consignee? When transporting freight (by ocean, air, or land), there are two parties involved — one who is shipping and the other who is receiving the freight. The recipient of the goods b... More) is given a title for the goods. He should present this to release the shipment and claim ownership. It acts as evidence of the confirmation of delivery.

As a business owner, you’ll want to make sure you’re cutting down on costs as much as possible. So, knowing what a BoL costs might prove to be beneficial to you:

How much does a BoL cost?

It’s necessary to know that this cost is payable by the carrier of goods at the time of releasing the BoL. The cost varies between US $5 to US $20. This includes all the documentation charges covered under the Bill of Lading. This document is crucial for the transportation of goods internationally. Thus, it’s considered a good practice to mention all relevant details clearly. This will help you avoid any miscommunication between the shipper and the consigneeWhat is a consignee? When transporting freight (by ocean, air, or land), there are two parties involved — one who is shipping and the other who is receiving the freight. The recipient of the goods b... More and subsequent delays. It’s also advisable to keep yourself updated with the latest information on Bills of Lading and other necessary documents.

It may seem like a lot to keep in mind and to keep track off, however, there’s a simple and effective solution to managing your shipping container documents:

Simplify bill of lading tracking with Container xChange

Imagine having all your B/Ls and shipment details in one centralized platform. No more jumping between multiple websites or making countless phone calls for updates. With Container xChange, you can manage your documents on one, easy-to-use platform. Bill of lading tracking has never been this easy!

By integrating with carrier systems and utilizing cutting-edge tracking technologies, you can get accurate and up-to-date tracking data with Container xChange. So, say goodbye to manual data entry and unreliable information, and yes to automated services.

You also get updates in real-time automatically. So, you’ll never miss important milestones like vessel departures, port arrivals, customs clearance, or delivery to the final destination.

Types of BoL

There are many different types of B/Ls, and they’re all based on factors such as:

The issuer
The purpose of the B/L
The relationship between buyer and seller

Usually, a BoL is divided into three types based on the mode of transportation of goods. These types are:

Air WaybillWhat is an Air Waybill? Air Waybill (AWB), or air consignment note, is a type of Bill of Lading (BoL) used while transporting freight via air. It is a shipment receipt issued by the agent or the carri... More (AWB)

All documents accompanying the goods are shipped through international air couriers.
It can also be referred to as an air consignment note.
AWB is a standard form distributed by the International Air Transport Association (IATA).
Serves as a contract of transportation and is non-negotiable.

Rail Waybill

A rail waybill is issued when the freight uses the railway as means of transportation.
The shipping agent or the railway line that transports the shipment prepares the Rail Waybill after receiving the instructions from the shipper.

Road Waybill

If you’re transporting your goods via road, your carrier will issue a Road Waybill. The document is called CMR.
The drivers and forwarders use this as an international consignment note. It informs them about the carriage of goods by road internationally.

E-BoL

The Electronic Bill of Lading is a digital representation of the traditional paper document. The E-BoL serves as a legal contract, receipt, and evidence of ownership for goods being transported in international trade. It replaces the physical document with an electronic format, facilitating faster and more efficient processing of shipping transactions.

Now that you’ve got an idea of the main kinds of BoLs, let’s take a look at the different types of Bills of Lading under these waybills.

15 types of BoL under main waybills

Master Bill of Lading	Actual shipping carriers such as MSC and Maersk issue the Master Bill of Lading.
House Bill of Lading	Freight forwarders issue and sign this type of BoL with terms and conditions specified by them. House BoL has a legal standing similar to a normal BoL.
Straight Bill of Lading	A straight B/L is used when you ship directly to a customer. They make an advance payment for the complete shipment. The specified consigneeWhat is a consignee? When transporting freight (by ocean, air, or land), there are two parties involved — one who is shipping and the other who is receiving the freight. The recipient of the goods b... More receives the goods, and cannot reassign or transfer the BoL to another party’s name. It’s non-negotiable.
Order Bill of Lading	It’s the most common type of BoL when the payment for the shipment is pending. The consigneeWhat is a consignee? When transporting freight (by ocean, air, or land), there are two parties involved — one who is shipping and the other who is receiving the freight. The recipient of the goods b... More can endorse the BoL to another party and order the shipment to be delivered in their name. It’s negotiable.
Bearer Bill of Lading	It’s simple to understand. When the bearer of the bill is the owner of the cargo, the Bearer BoL comes into the picture. There’s no consigneeWhat is a consignee? When transporting freight (by ocean, air, or land), there are two parties involved — one who is shipping and the other who is receiving the freight. The recipient of the goods b... More on this type of BoL. It’s negotiable because the ownership of the bill can be transferred.
Clean Bill of Lading	This BoL declares that the goods or cargo isn’t damaged or lost during the shipment. It’s issued after inspecting the cargo for any discrepancies and acts as a guarantee that the shipped goods are in good condition. A clean BoL is a must to complete the requirements asked in the letter of credit.
Claused or Foul Bill of Lading	The carrier issues a Claused or Foul Bill of Lading when the goods are damaged, the quality or quantity of goods is compromised, or doesn’t meet the required specifications. The damage, defects, and other discrepancies are outlined in the document. The consigneeWhat is a consignee? When transporting freight (by ocean, air, or land), there are two parties involved — one who is shipping and the other who is receiving the freight. The recipient of the goods b... More can reject a shipment if it arrives with a foul B/L.
Through Bill of Lading	This BoL allows the carrier to move the shipment across different distribution centers – through one or several different modes of transport. Depending on the mode of shipping, it needs an Inland and/or Ocean B/L. It‘s a multimodal Bill of Lading.
Surrender Bill of Lading	A surrender BoL issues the term where the negotiating bank’s receipt will have to be provided to the bank to release documents.
Stale Bill of Lading	This type of BoL is provided 21 days after the date of shipment for negotiation.
Charter Party Bill of Lading	The Charter Party BoL is an agreement between a vessel owner and charterer for the shipped goods.
Short Form Bill of Lading	This Bol is essential when the terms of the shipping contract are not mentioned in the original Bill of Lading.
Container Bill of Lading	It indicates that goods are delivered in a secure container from the port of origin to the transshipment port and finally the destination port.
Received for Shipment Bill of Lading	The carrier provides an acknowledgment before the vessel loading with an approved receipt of goods for shipping.
Bearer bill of lading	A bearer Bill of Lading (B/L) is a type of document that serves as a negotiable instrument in international trade. Unlike other types of B/Ls, which are typically issued to a named consigneeWhat is a consignee? When transporting freight (by ocean, air, or land), there are two parties involved — one who is shipping and the other who is receiving the freight. The recipient of the goods b... More or order, a bearer B/L is issued to “bearer” or “to the bearer.” This means that whoever is in possession of the physical document has the legal right to claim the goods mentioned in the B/L.

With all these BoLs, you might think it’s difficult to track them, however, this isn’t true! You can easily track your bill of lading on Container xChange. Our platform offers you an efficient and sure-fire way to keep track of all your container operations all in one place! Check it out here.

So, now you know all the different types of BoLs The next step would be to find out how the BoL differs from an invoice. Here are subtle differences between the two to look out for which we’ll get into next.

Difference between BoL and Invoice

A Bill of Lading (B/L) and an Invoice are both important documents for international trade. But they serve different purposes and contain different types of information. Here are the key differences between a Bill of Lading and an Invoice:

Purpose and function
Bill of Lading	Invoice
A Bill of Lading is primarily a transport document that serves as a contract of carriage and a receipt for goods being shipped. It outlines the details of the shipment, such as the description of goods, quantity, packaging, and shipping instructions.	An Invoice, also known as a commercial invoice or sales invoice, is a financial document issued by the seller to the buyer. Its primary purpose is to request payment from the buyer for the goods or services provided. The Invoice includes information such as the description of goods, quantity, unit price, total amount due, payment terms, and any applicable taxes or discounts. Unlike the B/L, the Invoice focuses on the financial aspects of the transaction rather than the logistics and transportation details.
Parties involved
Bill of Lading	Invoice
The primary parties involved in a Bill of Lading are the shipper, the carrier (such as a shipping line or freight forwarder), and the consigneeWhat is a consignee? When transporting freight (by ocean, air, or land), there are two parties involved — one who is shipping and the other who is receiving the freight. The recipient of the goods b... More (the recipient of the goods).	The key parties involved in an Invoice are the seller (supplier or provider of goods or services) and the buyer (purchaser or recipient of goods or services).

While both a Bill of Lading and an Invoice differ, they are equally as important when it comes to international trade. Another key difference is that a BoL can be tracked, whereas an invoice cannot be. And here’s how Container xChange simplifies tracking your BoL shipment.

Bill of lading tracking made easy with Container xChange

Tracking a B/L provides visibility and transparency throughout the transportation process. It allows all parties involved, including the shipper, consigneeWhat is a consignee? When transporting freight (by ocean, air, or land), there are two parties involved — one who is shipping and the other who is receiving the freight. The recipient of the goods b... More, and other stakeholders, to monitor the progress of the shipment, know its current location, and estimate its expected arrival time. This real-time information helps in managing inventory, planning logistics, and coordinating various activities along the supply chain.

Remember your seafood restaurant? Let’s say the shipment didn’t come in on time and you’re left wondering what to do or how to handle the situation. Well, with Container xChange, you won’t have to worry. Streamline your container operations by tracking your shipment on our online platform.

Container xChange makes everything a smooth sail. With us, you’ll have access to a 100% transparent marketplace whether you’re buying or selling. You can track your shipment and keep tabs on your box by using your bill of lading number, this way, you can avoid delays or any potential revenue loss to your business. Stay informed and ready to act on any mishaps easily. All this without having to move anything more than your fingertips! Click on the banner below and schedule a quick demo to see how xChange can help you!

Bill of lading: Common FAQs

What does a Bill of Lading track and prove?

BoL is used as a receipt issued by the carrier to the shipper when cargo is loaded onto the vessel. It comes in handy when goods are moving and a transfer of title happens. It serves as proof of ownership over the goods being carried.

Can a shipment be executed without a Bill of Lading?

No, a shipment can’t be executed without a Bill of Lading. This legally binding document is a must to transport goods from Point A to Point B.

What happens when the original Bill of Lading is lost?

If you lose your original Bill of Lading, you need court orders to issue a new document. Here, the court contacts the carrier and orders to release the cargo. It also orders shippers to pay the cost of the document. It's a lengthy process and can cause inconvenience. Thus, it’s necessary to keep the BoL safe.

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As a seasoned expert in international trade, logistics, and container management, I bring a wealth of knowledge and hands-on experience to shed light on the comprehensive overview provided in the article. With a deep understanding of the intricacies of Bill of Lading (BoL) processes and container logistics, I'll address the concepts discussed in the article:

Bill of Lading (BoL): A Bill of Lading is a crucial document in freight shipping, serving as an agreement between a shipper and a carrier. It acts as a receipt for the goods, evidence of a contract of carriage, and a title for the goods in shipment. The carrier, shipper, or receiver can sign the BoL, but it is typically issued by the carrier or its authorized agent. This document plays a vital role in establishing a contractual agreement for the transportation of goods and serves as proof of ownership rights.

Importance and Purpose of BoL: The BoL is a legally binding document that performs multiple functions, including being a receipt for received and delivered goods, evidence of a contract of carriage, and a title for the goods. It ensures a smooth and secure movement of goods in international trade, providing legal protection and clarity for all parties involved.

Components of a BoL: A standard BoL contains essential information such as the names and addresses of the shipper and receiver, purchase order or reference number, date of pick-up, order description of goods, weight details, packaging information, and any special notes or instructions. The carrier fills out most of this information, emphasizing the importance of accurate data.

Cost of BoL: The cost of a BoL typically ranges from US $5 to US $20, payable by the carrier at the time of releasing the BoL. This cost includes documentation charges and is considered a good practice to avoid miscommunication and delays.

Types of BoL: There are various types of BoLs based on factors such as the mode of transportation. These include Air Waybill (AWB), Rail Waybill, Road Waybill, and the modern solution of Electronic Bills of Lading (eBoL).

Container xChange: Container xChange offers a tracking feature that simplifies container operations. The platform allows users to track shipments, find containers globally, and manage documents in one centralized platform. With real-time updates and a user-friendly interface, Container xChange streamlines logistics, providing a hassle-free experience.

Difference Between BoL and Invoice: While both are essential documents for international trade, a BoL primarily serves as a transport document and a receipt for goods, while an Invoice is a financial document requesting payment for goods or services. The key differences lie in their purpose, function, and the parties involved.

Bill of Lading Tracking with Container xChange: Tracking a BoL is made easy with Container xChange, providing visibility and transparency throughout the transportation process. The platform offers real-time updates, secure communication, and a paperless solution for managing BoLs.

Common FAQs about BoL: The article addresses common questions about BoL, emphasizing its role as proof of ownership, the necessity for executing a shipment, and the legal implications if the original BoL is lost.

In conclusion, the article provides a comprehensive overview of the importance, components, types, and tracking of Bills of Lading in international trade and logistics, with Container xChange offering a streamlined solution for efficient container management.