Containers

What is a Bill of Lading?

A bill of lading, commonly referred to as a BOL or B/L, is a crucial document for freight shipments and serves simple, but important, functions. A bill of lading should be issued whenever a shipment is made between multiple parties using a common carrier, such as a trucking company or ocean or air freight service.

The bill of lading is sometimes confused with the freight bill, and while the documents are similar the two serve different purposes. The information on a freight bill should have the same information as the B/L but also contain any extra information such as additional fees and notes if any information on the BOL needs clarification. The major distinction is the freight bill will not be considered as evidence of a contract in the event of a claims dispute.

What is the Definition of a Bill of Lading?

  1. A bill of lading serves as proof that a contract exists between the freight carrier and the shipper, a contract that is put in place before the BOL is created. The B/L provides details of the shipment to the carrier, including where the shipment originated, its destination and an itemized list of the contents of the shipment. The bill of lading must be provided when the carrier picks up the shipment and is then given to the recipient of the shipment when the delivery is completed.
  2. A bill of lading serves as a receipt of goods by the shipping company and also as a receipt of services by the shipper. The bill of lading also confirms the freight was received by the shipper in good condition. As a copy of the bill of lading will be required for any claims, a signed copy of the BOL must be retained by the shipper to confirm the transfer of goods in the event of loss or damage.
  3. A bill of lading serves as proof of ownership, or title, of the shipment. The BOL typically contains the names of the shipper, the person or company receiving the goods and the freight company. Additional information of the B/L includes an itemized list of goods, handling instructions, the type of shipping container or packaging, the amount of weight of the goods, the freight class and terms of payment.

Who Issues the Bill of Lading?

The law requires the BOL to be issued by the carrier, as it is proof of their receipt of the goods. The B/L is issued directly by the freight carrier, or its representative agent, and given to the shipper as proof the shipment was both delivered to the carrier by the shipper and received by the carrier. This is because it is the carrier who will ultimately be held liable for anything that may happen to the shipment while the goods are in transit or in the carrier’s possession. While the shipper can write up a BOL, the carrier will have to inspect the cargo when tendered to make sure everything is accurate and make changes to the bill of lading as needed.

How to Fill Out a Bill of Lading?

Obtaining compensation in the event of loss or damage to the cargo can be all but impossible without a properly filled out B/L. The following is the information that should be included on the bill of lading.

  • The full names of the shipper, or the sender, the carrier, or the freight company, and the receiver, or recipient, also called the “consignee.”
  • The complete addresses of the shipper, carrier, and consignee.
  • The date the shipment is picked up and expected delivery date.
  • The number of goods. This may include the number of units, weight and/or volume, depending on the goods shipped. This should include the type of shipping packaging, such as boxes, drums, and pallets.
  • An itemized description of the freight, including the name of the material.
  • Statement of DOT hazardous material notice.
  • When shipping multiple units, each unit’s weight should be listed independently on the B/L
  • The declared value of the freight.
  • The freight classification.
  • Order tracking numbers.
  • Any special-handling instructions.
  • Payment details

While it is the carrier’s responsibility to produce and/or verify the bill of lading, the shipper must also verify and agree to any changes the carrier makes to the document. Remember that if a dispute should arise, the bill of lading is the go-to document to prove what goods and services were contracted for by the sending, shipping and receiving parties.

There are several types of BOLs, and the information contained in each type may vary slightly. For example, ocean, air and land transport will all have some variation, Depending on if the cargo is going or coming from overseas, there may be custom’s information to deal with as well. Additionally, a prepaid shipment, typically known as a “straight bill of lading,” should also note that payment has already been made.

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