Bill of Lading: What it is, how it works and example

What is a Bill of Lading?

A bill of lading (B/L or BoL) is a legal document issued by a carrier (such as a shipping line or freight forwarder) to a shipper. It contains key information about the cargo—such as quantity, type, and destination—and serves as a receipt for the goods being transported.

The bill of lading accompanies the shipment and must be signed by the shipper, the carrier, and the consignee (receiver of the goods). In the Netherlands, this document is also called a connossement.

Tips from Kuipers

We work with Bills of Lading every day. And there are a few key points to pay close attention to for a smooth shipping process. Our Air & Sea department manager, Wouter Engbersen, shares some helpful tips:

Be aware of destination country regulations

“Always discuss with your customer whether there are specific rules in the destination country that affect how the Bill of Lading should be filled out. Product descriptions, quotations, and correct HS codes are very important. The B/L must match the information on the provided documents and goods. In countries like Angola, Brazil, and Argentina, customs only accept original Bills of Lading — Sea Waybills are rejected.”

Clarity About Freight Payment

It must be clear where the goods are going and who is responsible for paying the ocean freight. That’s why Wouter always double-checks that all details are correct on the Bill of Lading.

• Freight Prepaid means you pay the ocean freight at the port of origin.
• Freight Collect means the freight is paid upon arrival at the destination port.

These terms are typically agreed upon when selecting Incoterms.

Pay on Time

“Make sure to pay for the goods on time. If the shipping line or forwarder issues an original transport document, they will require original documents from the supplier. These are often only released after payment. Submit all required documents promptly to avoid extra costs for delays at the port of discharge. Also known as demurrage.”

Check the Bill of Lading Carefully

The Bill of Lading guides the entire transport process. That’s why it’s extremely important that all information on the B/L is 100% correct. Shipping lines load their vessels based on the B/L details. If anything is wrong, it must be corrected before the cargo can be loaded — potentially costing you days of delay.

Essential details that must be on the Bill of Lading:

• Name of seller/intermediary
• Buyer/owner of the goods
• Confirmation of receipt by the shipping line
• Whether freight has been paid or not
• Number of originals and copies
• Name of the shipping line / nationality / shipping marks
• Clean Bill of Lading
  • This means the goods are in good condition, as agreed. If not, it’s called a dirty B/L, for example due to damage. This must be resolved before departure — otherwise, it may jeopardize payment.

Functions of a Bill of Lading

The Bill of Lading has three key functions:

1. Proof of ownership of the goods described in the B/L
2. Receipt of the goods by the carrier
3. Contract of carriage describing the agreed terms of transport

Bill of Lading example

(Example: Bill of Lading issued by Kuipers Air & Sea B.V.)

Why is the Bill of Lading so important?

The Bill of Lading is a legally binding document that provides both the carrier and shipper with all the necessary details to handle a shipment accurately. It can also be used in legal proceedings if required. This is yet another reason why it’s so important to fill out and verify the B/L properly.

Furthermore, a Bill of Lading also serves as proof of shipment. In addition, a B/L enables a separation of duties, which is an important part of a company’s internal control structure to help prevent theft.

Switch B/L

Want to keep your supplier’s details hidden? For example, when reselling products while they’re in transit? Then a Switch B/L is the solution. This prevents your customer from contacting your supplier directly.

As your logistics provider, we can arrange a Switch B/L for you. Still, it’s never guaranteed that a customer won’t find out the name of your manufacturer. Often, branding or labels are still visible on the packaging at the port of loading.