Meaning Of Ocean Bill of Lading
An ocean bill of lading is a contract between the shipper and the ocean carrier. The document acts as a carrier receipt to the shipper. The bill contains every detail of goods that are being transported. This document is submitted to the shipper while picking up goods. The shipper later gives it to the receiver on the delivery of goods. Visit “Bill of Lading and its Types” to learn more about the concept.
An ocean bill of lading consists of information like the name and address of the parties involved, the total number of units shipped, terms of the agreement, packing material used, the value of the shipment, etc. The bill serves as a legal binding on both the shipper and carrier. This bill is specifically for international transportation, and it let the shipper of goods carry them across the international waters. However, if the goods are to be shipped on land, an inland bill of lading is required.
Is Ocean Bill of Lading Negotiable or Non-Negotiable?
There is often confusion in relation to the ocean bill of lading and whether it is a negotiable or non-negotiable instrument. It may be a negotiable or non-negotiable instrument depending on the terms of the agreement. A negotiable ocean bill of lading can be sold, bought, and traded when the goods are in transit.
Ocean bill of lading is of many types. The most commonly used are as follows.
Types of Ocean Bill of Lading
Straight Bill of Lading
It is a non-negotiable instrument. In the straight bill of lading, only the person whose name appears on the bill can claim the goods. This type of bill is used mostly when the exporter is not concerned about the receipt of payment from the importer upon receiving the goods.
Shipper’s Order Bill of Lading
It is a negotiable instrument. The shipper’s order bill of lading consists of conditions while delivering the goods. The conditions may include fulfilling the terms of the letter of credit before receiving the goods.
Clean Bill of Lading
A clean bill of lading is issued when the receiver receives the goods without any damage or shortage. In case the product delivered consists of flaws, a clean bill of lading will not be issued.
On-Board Bill of Lading
The master of the vessel signs this bill of lading. It is issued when the cargo is placed abroad in a vessel.
An ocean bill of lading is a contract between the shipper and the carrier. It defines the terms and conditions of the agreement. This document brings transparency to the transaction. It also assures the importer that his goods will be delivered, and the exporter is not concerned about the non-receipt of the payment. In some cases, if there is a default in payment, the banks are authorized to take control of the goods. Thus, the ocean bill of lading is a boon in international trade.
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