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Types of Bill of lading

types of bill of lading

Types of Bill of Lading

Bill of lading can be generally classified using two basis one is “how it is executed” and another is “Method of operation”-

On the basis of execution:

  • 1) Straight bill of lading: It reveals that the products are consigned to a specific person which is not free from negotiable existing equities. It means an endorsee (to whom bill of lading is made payable) can acquire no better rights than those which are being held by the endorser. Such bill is also known as a non-negotiable bill of lading, and as per banker’s point of view, it is not considered as a safe way. Adding on this type of bill is protuberant used for military cargo.
  • 2) Open bill of lading: This is considered as a negotiable bill of lading where the name of Consignee could be changed with related consignees’ signature and thus can be transferred. Such bill of lading can be easily transferred multiple times as per the needs. Switch bill of lading can be seen as a type of open bill of lading.
  • 3) Bearer bill of lading: As per bearer bill of lading terms delivery have to be made to the specific person whosoever holds the bill. These bills can be created explicitly or it can be seen as an order bill which fails to nominate the beneficiary whether in its original form or via an endorsement in blank. A bearer bill of lading can even be negotiated by physical delivery. They are generally used for bulk cargo that has been turned over within small amounts.
  • 4) Order bill of lading: It is a type of bill which uses certain express words in order to make bill of lading negotiable. This means that the required delivery must be made to the further order of the beneficiary by making use of words such as “delivery to A Ltd. or to order or assigns. The cargo is only delivered to the person who is actually the holder of the bill of lading, and it initially verified by an agent who is responsible for issuing the delivery order as well as the verified bill of lading.
    • The order bill of lading:

    • is one of the most modern type bills that is widely used all over the world for shipping consignments
    • ensures safe delivery of cargo to an authentic holder of B/L
    • In international trade the ship has to visit several foreign ports having different language, practice, procedures because of which master bill of lading might be inconvenienced during the delivery of the consignment. There could be fraudulent collection of the cargo.
    • In order to overcome such difficulties and to avoid future cargo claims as well as litigations, the holder has to surrender the bill of lading to the ship’s agent over the discharge port who further verify the genuineness of the bill of lading.

When bill of lading is turned as “to order” of the consignee, it becomes a negotiable instrument of title. As a result, the ownership of the bill can be transferred from one person to another by just authorising signature as well as the delivery of the bill of lading.

ON the basis of Method of Operation:

  • 1) Received for shipment bill of lading: This type of bill of lading is usually sent from agent or charterer to the shipper. The endorsement of this bill helps in ensuring that the carrier has already received the consignment but it does not provide confirmation that the consignment is onboard over the assigned vessel
  • 2) Shipped B/L: Such bill of lading is generally Issued when the cargo is loaded on board. It is responsible for directly binding the shipowner and the shipper.
  • 3) A clean bill of lading: This bill states that the cargo has been already loaded onboard over the ship in apparently good condition. Such a bill does not bear a clause and notation for expressly declaring a defective condition of commodities or its packaging. The contrary term that is used is a soiled bill of lading. It reflects that the commodities were received in anything but best condition by the carrier.
  • 4) Through B/L: This bill of lading is considered as a legal document which allows the direct delivery of cargo from A point to B point. The bill permits transportation of commodities in both domestic borders as well as through international shipment as it specifically serves as a receipt of the cargo, a contract of carriage, and even title for the goods as well.
  • 5) Combined transport B/L: This bill provides information that the cargo has been transported using large containers by sea and land or by using through multimodal transport
  • 6) Dirty bill of lading: If the shipowner want to raise an objection about “the condition of the cargo is in good order”, then they can include a clause which results in causing the bill of lading to be “claused or dirty” along with certain remarks as per the actual cargo condition that has been found by them such as torn packing, broken cargo, shortage in the quantity of the products and much more.

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