A bill of lading is a receipt and evidence to show that shipment of merchandise has already been delivered. In international trade, a seller needs such a document to claim payment. By way of shipment, a billing of lading can be divided into 1) an ocean bill of lading and/or 2) an airway bill of lading. By function of the document, a billing of lading can be a straight bill of lading or an order bill of lading.


A straight bill of lading is non-negotiable and transferable. This means that the shipment is consigned (delivered; shipped) directly to the consignee (buyer; importer). The buyer owns the right of the shipment.


An order bill of lading is transferable. When an exporter is not entrusted with his services in handling shipment, a buyer can demand an order bill of lading to authorize the ownership of goods to a third party temporarily. Banks are such party who will examine if the shipment is made by following the buyer's instructions. In this way, the bank can guarantee that the goods is shipped and delivered in good condition. It then will release the goods to the importer and commands payment to the seller.

Demanding a shipping company to issue an order bill of lading is a solution for safe shipment, but it costs more fund and handling charges are expensive. Normally, order bill of lading is issued when two parties are recently starting their businesses. Due to inexperience with each other, they will agree to issue an order bill of lading to safeguard shipment if payment is to be made.

All bills of lading are expected to be clean. This means the document must not bear such comments by the first mate as missing, damaged or delayed goods. A clean bill of lading is a shipping document required by a letter of credit. A clean bill of lading guarantees duly payment.

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