A bill of lading (BOL or B/L) is a legal document issued by a carrier that serves three primary functions:
- It acts as the contract between the carrier and shipper
- Serves as the receipt for the shipped goods
- Functions as the document of title
BOLs are also instrumental in tracking shipments to their final destination.
How Do Bills of Lading Work?
A BOL accompanies the cargo throughout its entire transport journey and must be signed by the carrier, shipper, and receiver to become legally binding.
Bills of lading contain essential information, including:
- Cargo details: weight, value, and classification
- Parties involved: shipper, carrier, and receiver contact information
- Route and transportation method
- Special instructions, if applicable
- The carrier’s terms and conditions for service
In simple terms, a BOL provides both the shipper and carrier with all necessary information to process and manage a shipment effectively.
Beyond its legal and logistical functions, a bill of lading helps reduce theft and shipment discrepancies by offering clear documentation of the cargo’s contents. Because it is a legally binding document, a BOL can also serve as undisputed proof in litigation or legal disputes related to shipping.
Due to their importance, all parties must take care to accurately complete and securely file these documents.
Types of Bills of Lading
There are multiple types of BOLs, each serving a specific purpose. Common types include:
- Inland Bill of Lading
- Ocean Bill of Lading
- Through Bill of Lading
- Negotiable Bill of Lading
- Nonnegotiable Bill of Lading
- Claused Bill of Lading
- Clean Bill of Lading
- Uniform Bill of Lading
- Air Waybill (AWB)
Using the correct type of bill of lading is essential to avoid unexpected delays in transporting or tracking cargo through to its final destination.