Bill of Lading 101

You’ve been requested to forward a bill of lading to your freight forwarder. However, this is your first time importing or exporting a product to and from the US. You call for help because you are simply in a daze on what they are requesting.

Here is an easy and friendly guide for you to be acquainted with the infamous Bill of Lading document.

What’s in a bill of lading?

This is an example:

Sample bill of lading

Sample bill of lading

At times, it is referred to as B/L or BoL. It is a document showing the agreement between individuals, groups companies and corporations. It contains details such as:

  • Owner of goods
  • Freight forwarder of the items
  • Receiver of the goods

Why is it important?

The bill of lading is one of the most important document for an importer or exporter. Transactions between freight forwarder, shipping lines, importer and exporter would be impossible without it.

It is one of the two critical items, the other being letter of credit, of the shipping documentation. It details the following:

  • Seller
  • Receiver
  • Notify party
  • Shipping terms
  • General consignment

It also includes containers and general merchandise information such as packages, weights, cubic meters or feets. It dictates where the cargo is to be shipped to and from, which in some cases can be quite technical, such as destinations with two main ports like Ho Chi Minh, Vietnam.

How are bills of lading issued and processed?

Bills of ladings can be issued as an original and courier from the seller to the buyer as a receipt of release. It can then be processed as Telex or Express release once the seller receives payment. The seller surrenders the original back to the origin forwarder who then allows release without the original.

It can also be issued as Waybills, which are generally used for sellers who give credit terms to buyer, or for products that have been paid prior to arranging the consignment.

What are the different types?

Great! You’ve learned the basic things about B/L. It’s now time to learn the different types of bill of lading that can be issued to you.

House bill of lading

This is issued by the forwarder based on the information received from the seller via the forwarding instruction.

Sample house bill of lading

Sample house bill of lading

Ocean bill of lading

This is issued by the shipping company based on the information from the forwarding instructions. It is generally issued between forwarder to forwarder and service contracts to prevent importers and shippers from booking direct via the master carrier.

Through bill of lading

You’ll find this type of bill of lading common in shipment containing both seafreight and airfreight in the same transaction. It is most helpful in avoiding full airfreight costing while providing better transit time.

Switch bill of lading

There are instances wherein the importer or exporter would want to hide details of the supplier or shipper to their customers. What bill of lading should you use for these types of situations? – switch bill of lading

It is commonly used on “sold as” consignments. It involves one bill of lading between the shipper and the company as the consignee, then an additional bill showing your company as shipper and your customer as the consignee.

What are the different release types available for house bill of lading

You’re getting there. Just a few more interesting things to know about B/L and you’ll soon understand the terms associated with your bill of lading.

Original

Original B/L are issued in only 3 copies. We strongly recommend you keep one for safekeeping in case you need one in the future.

Original bill of lading

Original bill of lading

When is this needed?

Some destination forwarder requires an original bill of lading to be presented to them prior the release of your consignment.

Why?

It is an assurance that the cargo is void of any liability and payment from customers has been settled. Thus, most suppliers prefer to operate using the original bill.

Telex Release

There are instances where the original bill of lading may not be required. During these occasions, Telex or Express release may be accepted.

Sample telex release bill of lading

Sample telex release bill of lading

What is a telex release?

A telex release is a copy of the original bill sent via email to your destination forwarder. This is their go signal to release your freight.

When is a telex release requested?

In most occasions, shippers request original bills. However, only after they’ve received payment will they request a Telex or Express release.

Sounds logical because it guarantees the importer/exporter has fulfilled their financial obligation.

Are there various types of telex release?

You’ll find two types of telex release:

  • Copy of the B/L with telex stamp
  • Note on the bill from the sending forwarder

Want to learn more about Telex Release? We shall be discussing more about Telex release in our next blogs.

Express Release

Express release is an alternate term to Telex Release.

Sample express release bill of lading

Sample express release bill of lading

Sea Waybill

Do you want an immediate way of having your sea waybill released? Choose sea waybill. However, it is a privilege given by shippers with long standing arrangement or credit terms with their customers.

Deal with freight forwarders that have long standing relationships with shippers. Call FFQO at 1-877-901-2004, today.

So what’s the best choice for my B/L release?

We highly recommend the use of telex or express release, simply because it is the quickest way to release your consignment. However, if you are receiving original bills please ensure you only send one or two as a maximum because it is always best to have a spare original bill of lading.

Got freight forwarding questions? Ask the expert.Feel free to contact us online and send a message. You can even message us on Facebook.

PS – A related important document is Letter of Credit. Click here to learn more about the letter of credit.