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A bill of lading (B/L) is the document a carrier issues for goods carried by sea. Turkish law regulates it under the Turkish Commercial Code (Law No. 6102, Article 1228 onwards), and it does three jobs at once: it evidences the contract of carriage, it shows that the goods have been received or loaded on board, and it obliges the carrier to deliver the goods only against presentation of the document.
That last feature is what sets a bill of lading apart from an ordinary receipt: whoever holds the document controls the cargo. This is why it is the most critical paper for banks in letter-of-credit sales, for buyers of goods sold while afloat and for whoever collects the goods at the port of discharge.
What a bill of lading shows
- Shipper, consignee and notify party
- Vessel name, voyage number, port of loading and port of discharge
- Container and seal numbers, number of packages, description of the goods and gross weight
- Whether freight is prepaid or payable at destination (collect)
- Place and date of issue and the number of originals issued
Originals are usually issued as a full set of three. Once delivery has been made against one of them, the others become void, so you need to know at every stage who holds the full set.
Types of bill of lading
A bill of lading takes different names depending on when it is issued, how it is transferred and what is noted on it. Letters of credit and sales contracts often state exactly which type is required:
| Shipped on board B/L | Issued after the goods have been loaded on the vessel; this is the type most letters of credit ask for. |
|---|---|
| Received for shipment B/L | The carrier has taken the goods but they are not yet loaded; once the loading date and vessel are noted on it, it counts as a shipped B/L. |
| Order B/L (to order) | Transferred by endorsement, so the cargo can be sold while at sea. Unless agreed otherwise, a bill of lading is issued to order. |
| Straight B/L | Made out to a named consignee; it is transferred by assignment of the claim, not by endorsement. |
| Bearer B/L | No consignee is named; whoever holds the document can claim the goods. Losing it carries the greatest risk. |
| Clean / claused | A clean B/L notes no visible defect in the goods; a claused B/L carries a remark such as "packaging damaged", and banks often refuse it. |
Two more terms come up often in practice: the master B/L issued by the shipping line and the house B/L that a freight forwarder issues to its own customer. Which one has to be presented at destination depends on how the shipment was set up.
What the B/L number is for
The bill of lading number is the unique reference a shipping line gives each shipment. With it, the tracking page on the line's website shows whether the container has been loaded, where it is transhipped and the estimated time of arrival.
The number is also the key at customs: in the summary declaration lodged before the vessel arrives, goods are listed bill by bill, and the later declaration is matched to that record. Making sure the package count and weight on the invoice, the packing list and the bill of lading agree prevents quantity discrepancies on arrival.
Delivery order: from bill of lading to release
At the port of discharge you do not collect the goods with the bill of lading itself. The original B/L (or a telex release instruction) is handed to the shipping line's agent, local charges are paid and the agent issues a delivery order. The terminal releases the container to the party presenting the delivery order.
If the originals are delayed at a bank or with a courier, the delivery order is delayed too, and while the container waits at the port demurrage and detention start to run. To reduce that risk the parties can use a telex release or a sea waybill: neither requires an original to be presented at destination. Because the document then no longer circulates as a document of title, these options are not used in letter-of-credit sales.
Bill of lading, delivery terms and the bonded warehouse
Who pays the freight and who receives the bill of lading is decided by the delivery term in the sales contract. Under Incoterms 2020 the buyer arranges freight on FOB terms and the seller on CFR and CIF terms, and the bill of lading is made out accordingly.
If the goods are not to be imported straight away, the container collected with the delivery order is brought to a bonded warehouse and stored under customs supervision. The description, package count and weight on the bill of lading must then match what is declared in the warehouse declaration; any difference found in the count on arrival is recorded in a report.
An order bill of lading can be endorsed so that the goods are sold while still at sea. If the goods change hands after entering the warehouse, the transfer is recorded in the warehouse records instead, and the new owner pays the duty on its own import. In short, the bill of lading is the identity of the goods at sea; once they are ashore, the declaration and the warehouse records take over that role.
