A bill of lading (BOL) is a document that should accompany every shipment as it includes important details about the cargo. However, if you’re unfamiliar with the ins and outs of this kind of contract, some elements can be confusing or difficult to decipher. To help, we’ve unpacked everything you need to know about navigating a BOL and understanding its key clauses.
First off, a bill of lading refers to a legal document between a shipper, carrier, and consignee detailing what goods are being shipped, where they’re coming from, and where they’re headed. This contract is a receipt that outlines the terms and conditions of the shipment and confirms the carrier received the cargo.
A BOL will include important information, such as:
Shipper and consignee details
Carrier information
Description and quantity of goods
Freight details
Port of loading and discharge details
Special instructions
Vessel and voyage information
BOL number
Date of issue
Signatures
Since there are a lot of elements to a BOL, we’ve outlined some helpful steps when it comes to understanding and reviewing a BOL of your own:
Determine the Carrier: Find the carrier’s name and the signature of the carrier’s representative and then review the carrier’s information in the paramount clause.
Review Cargo Details: Confirm that the cargo descriptions, such as weights and quantities, match your records.
Understand Liability, Risk, and Additional Fees: Consult the Incoterms and clauses to determine all liability, risks, fees, and conditions.
Confirm Regulatory Compliance: Make sure the contract meets all customs and documentation requirements and adheres to rules and regulations.
Familiarize Yourself with Additional Actions: Ensure you know how to transfer ownership, file a claim, resolve disputes, and interpret clauses.
Learn How to Handle Electronic BOLs: Electronic BOLs tend to be more secure and efficient than hard copies, so be sure to learn the electronic system and confirm all digital endorsements.
Now, because a BOL is a legal contract, it includes several clauses. It’s important to review these and understand their implications:
“Said to Contain” Clause: Under this clause, the carrier accepts the shipper’s declaration of the cargo type and quantity without individually verifying it.
Paramount Clause: This clause outlines what international legislation applies to the shipment.
New Jason Clause: In the event of a general average situation like an accident or disaster, this clause may give carriers the right to claim a contribution from cargo beneficiaries to cover the incident.
Blame Collision Clause: If a collision occurs, this clause addresses liability and the right to claim damages.
“Weight, Measure, Quality, Quantity, Condition, Contents and Value Unknown” Clause: This clause helps protect the carrier when they cannot independently confirm shipping details.
General Average Clause: Under this clause, cargo owners agree to contribute to losses associated with saving a vessel and its cargo during a general average situation.
“On Deck at Shippers’ Risk”: If the BOL includes this clause, then the cargo stowed on the ship’s deck has limited carrier liability.
