What are the three types of BL?

Navigating the complexities of international trade requires a firm grasp of crucial documentation, and the Bill of Lading (BL) stands as a cornerstone. Often referred to as the “passport” of goods, the BL serves multiple critical functions, acting as a contract of carriage, a receipt for cargo, and a document of title. However, not all Bills of Lading are created equal. To ensure smooth and efficient transactions, it’s vital to understand the distinctions between the three primary types: Original, Surrendered, and Sea Waybill.

1. The Original Bill of Lading:

This is the most common and arguably most important type of BL. Issued in a set, typically three originals, it represents the legal ownership of the goods. The consignee (the party to whom the goods are shipped) must present at least one original BL to the carrier at the destination port to claim the cargo. This requirement ensures secure transfer of ownership and prevents unauthorized release of goods. Key characteristics include:

• Negotiable: The original BL can be endorsed and transferred to another party, effectively changing the ownership of the goods in transit. This facilitates trade financing and allows for the sale of goods while they are still at sea.
• “To Order” or “Straight”: An “To Order” BL allows for transferability through endorsement, while a “Straight” BL designates a specific consignee and is non-negotiable.
• Evidence of Contract of Carriage: It outlines the terms and conditions agreed upon between the shipper and the carrier.

2. The Surrendered Bill of Lading:

This type of BL comes into play when the shipper requires the goods to be released to the consignee without the physical presentation of the original BL. This is often used when trust exists between the trading parties or to expedite customs clearance procedures, particularly for time-sensitive goods. The shipper effectively relinquishes their control over the shipment by surrendering all original BLs to the carrier at the port of loading. Key characteristics include:

• Faster Release: Eliminates the delay associated with physically transferring the original BL.
• Increased Risk: Surrendering control necessitates a high level of trust between the shipper and consignee.
• Irreversible: Once surrendered, the shipper cannot reclaim control of the goods.

3. The Sea Waybill:

The sea waybill is a non-negotiable document that serves as evidence of a contract of carriage and receipt of goods. Unlike the original BL, it does not function as a document of title. This means the consignee named on the sea waybill can claim the cargo at the destination port simply by providing identification, without presenting any physical document. Key characteristics include:

• Simplified Process: Streamlines the cargo release process, as no document exchange is required at the destination.
• Non-Negotiable: Cannot be endorsed or transferred to another party.
• Suitable for Regular Shipments: Ideal for established trading relationships where the risk of disputes over ownership is minimal.

Choosing the right type of Bill of Lading is crucial for seamless international trade. Understanding the nuances of each – Original, Surrendered, and Sea Waybill – empowers businesses to optimize their shipping processes, manage risk effectively, and ensure smooth transactions in the complex global marketplace.