Multimodal Bill of Lading – Meaning, What it Includes, and More

If a business undertakes exporting activities, then it has to deal with several types of documents. And one of the most crucial documents that a business needs to take care of is the Bill of Lading or BOL. It is basically a document (or a receipt) facilitating the transportation of a shipment. Usually, a carrier issues a bill of lading after accepting the goods from the exporter. There are several types of bill of lading that come into use in specific situations. In this article, we will talk about the Multimodal Bill of Lading.

Multimodal Bill of Lading – What it is?

This bill of lading comes into play when the shipment of goods involves at least two distinct modes of transport. For example, the shipment is through sea and rail. In a Multimodal BOL, one leg of transportation is usually via ship, but it is not mandatory. There can be more than one mode of transportation -land, sea, rail, and air.

It is not possible that all exporters have their office or warehouse near a seaport. This means some exporters will have warehouses inside the city. Thus, the carrier first needs to pick up the goods from the exporters’ location, either by road or rail. And then use the sea route to deliver it to the importer or importer’s carrier. Thus, in such a case, the carrier completes the shipment by using two or more transportation modes.

In such type of shipment, it becomes convenient for the shipper to use a Combined Bill of Lading (or Multimodal BOL or Multimodal Transport Document). This is because this one document would cover all the modes of transport that a carrier uses. If there is no Combined BOL, then the shipper would have to use separate BOL’s for each leg of the shipment.

So, we can say that Multimodal BOL covers the movement of one shipment, from start to the end, using more than one transportation method without breaking up the unit load.

For example, an exporter from New York wants to send a parcel in New Delhi, India. First, the parcel leaves the exporter’s location in New York onto a truck to reach the nearest port. Then from that port, the parcel is shipped to a port in India. Then from that port, that parcel was loaded onto a train for delivery in New Delhi.  

Multimodal Bill of Lading – What it Contain?

A Multimodal BOL should carry the name of the carrier. Either carrier or its named agent can sign this BOL. Similarly, the shipper or its named agent can sign the document. 

This document must state if the shipment is dispatched or if the carrier has taken charge of the shipment at a specific location. Further, it must also mention the place of dispatch and the final location where the shipment is going.

Generally, a BOL is the only original transport document. But, if there is more than one original copy of this BOL, then the document must state that.

The document must carry all the terms and conditions of carriage. And if it doesn’t, then it should refer to another source, which stipulates the terms and conditions of carriage.

Multimodal BOL

How it’s Different from Through Bill of Lading?

A Through BOL is almost identical to the Multimodal BOL. But, there is one subtle difference between the two.

A Multimodal BOL involves at least two modes of transportation. But, a Through BOL involves using one transportation method, i.e., water. However, a Through BOL can have more than one leg of transportation, such as inland water and sea.

A sea carrier issues the Through BOL. Suppose a shipment has three legs and uses three transportation methods – inland water, sea, and land, and the carrier issues a Through BOL. In that case, the carrier will be responsible (shortages, losses, damages) for water passage only.

Final Words

A Multimodal BOL could prove very convenient for both – exporter and importer. Under this BOL, the parties need to take care of only one document for the shipment. It results in cost-saving, as well as time savings.

Visit Bill of Lading and its Types for more details.

Frequently Asked Questions (FAQs)

How many bills of lading are used in multimodal transportation?

Under the multimodal bill of lading, one document covers all the modes of transport that a carrier uses.

What are the advantages of a multimodal BOL?

A multimodal BOL has the following advantages:
1. Covers the movement of one shipment from start to the end using more than one transportation method without breaking up the unit load.
2. Convenient for both exporter and importer as the parties need to take care of only one document.
3. Results in cost-saving as well as time savings.

How is multimodal BOL different from through BOL?

Multimodal bill of lading uses at least two different modes of shipment, such as sea and land. While through BOL has one mode of transportation (usually water), but the legs are distinct, such as inland and ocean.

Sanjay Borad

Sanjay Bulaki Borad

MBA-Finance, CMA, CS, Insolvency Professional, B'Com

Sanjay Borad, Founder of eFinanceManagement, is a Management Consultant with 7 years of MNC experience and 11 years in Consultancy. He caters to clients with turnovers from 200 Million to 12,000 Million, including listed entities, and has vast industry experience in over 20 sectors. Additionally, he serves as a visiting faculty for Finance and Costing in MBA Colleges and CA, CMA Coaching Classes.

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