Understand Bill of Ladings

A Bill of Lading, or BOL, is a legal form that a shipper must fill out before the shipping process can begin. It is a legally binding document that can be used in legal disputes between a shipper and carrier, so it is very important to fill in the form as accurately and completely as possible.

A BOL has three specific functions:

• It acts as a receipt proving what the goods are and confirming that they have been loaded on the vessel or truck
• It outlines the contracted terms of transport
• It states the ownership/title of the goods being transported

The Federal Motor Carrier Safety Administration (FMCSA) provides the regulations for interstate and foreign transport. For BOL regulations on intrastate (same-state) transport, you would need to refer to the state transport governing body you are shipping within, however most states have similar requirements to FMCSA. 

Standard Types of BOLs

Straight Bill of Lading 

This is a non-transferable type whereby the consignee (the intended recipient) is the only person that can sign and accept the shipment

Seaway Bill of Lading

This is a shipment between companies where the expectations of an original bill of lading are more relaxed. This is also known as an “express release”.

Air Waybill

These are BOLs used for air transportation only.

Negotiable Bill of Lading

This type acts like a check, with the document being consigned to a company or shipper. Replacing this type of BOL is a difficult process and those carrying it are strongly encouraged not to misplace the document.

Port to Port Bill of Lading

This type puts responsibility of the shipment on the carrier from pick up to the drop off port. In this instance the BOL will not specify the specific destination, only the destination port. This type is sometimes referred to as an “ocean bill of lading”.

Combined Transport Bill of Lading

This type is covers multiple transportation points, with the carrier responsible for the safe transport at every stage. This is often referred to as a multimodal transport bill of lading.

Through Bill of Lading

This type also covers multiple transportation points, however the onus of safe delivery to the final destination is not on the carrier. The carrier is only responsible for the sea and port transportation.

Fraudulent Bills of Lading

These refer to BOLs that are forged or inaccurate on the description of cargo or other information. Usually these occur when an individual or entity forge the signature of the intended consignee. 

Bill of Lading Tips  

The BOL is the first document shippers and carriers refer to when something goes wrong. The BOL is the document freight and cargo inspectors refer to when determining if the shipment is in compliance. And as mentioned, the BOL is a legally binding document. Thousands of dollars could be on the line in a given shipment, so accuracy is paramount.  

Double Check Your Information

The shipper should make sure all the information on the form is correct and legible before signing and sending out the shipment. This includes making sure the proper NMFC classification is noted. If a discrepancy is found between the listed class on the BOL and what the actual freight is, a reclassification can occur with costly fees applied. (Please see our post NMFC Codes for Freight Classification for more information).

Carrier Rate Shopping Guide

Train Your Staff

Training your shipping and receiving staff on the importance of accuracy and employing audits to hold staff accountable is a best practice tip. It is also a good idea to use one standard BOL form. There are a number of versions on the internet and sticking to one form will help standardize the process for your shipping team.

Get a TMS

A Transportation Management System (TMS) is an invaluable tool in managing BOLs and many other shipping processes, from obtaining quotes to tracking customer shipments. A good TMS will allow you to print BOLs directly from your orders clearly and with less chance of human error than filling out forms by hand.

For more shipping tips, check out our eBook bundle covering carrier rate shopping, digitizing supply chains, tracking and reporting, and parcel & freight auditing!