he bill of lading is the most important export document whenever goods are sent by ship. It is issued by the shipping company.

Bill of lading

1. The bill of lading is the most important export document whenever goods are sent by ship. It is issued by the shipping company.

2. The key information in a bill of lading are as follows:

(a) The name of the shipping company.

(b) The name of the shipper (beneficiary) or his agent.

(c) The name of the carrying vessel.

(d) The names of the ports of shipment and discharge.

(e) The identification (shipping) marks and numbers.

(f) The number of containers, cases, packages or individual items.

(g) A description of the goods in general terms consistent with the description of the goods in the letter of credit.

(h) Evidence that the goods have been received for shipment or shipped (loaded) on board and its date.

(i) The name of the consignee (if not made out 'to order') and also the name and address of the 'notify party' wherever applicable.

(j) Whether freight has been prepaid or payable at destination.

(k) The number of originals issued (A bill of lading is normally issued in a set of three originals; anyone of which may be used to take delivery and possession of goods. It is important that the consignee must secure all the originals.)

(l) The date of issuance and the signature of the ship's master or the carrier or his agent.

3. Bills of lading are normally issued in a 'set' of two or more transferable copies, all of which must be signed by the master of the ship who makes a note on the bills of lading, of the number of copies issued and any damages to the goods taken on board. He then keeps one copy for reference. The other copies are sent to the foreign importer by separate mail or returned to the exporter (consignor).

4. However, if the exporter has arranged for the importer to open a letter of credit in the exporter's favour in a local bank, then the bills of lading together with the other shipping documents such as the invoice, the consular invoice, the marine insurance policy and a certificate of origin must be lodged by the exporter at the local bank, together with the bill of exchange.

5. It is one of the documents that has to be submitted to the advising bank before the shipper can secure payment in the letter of credit.

6. The functions of a bill of lading are as follows:

(a)   It acts as an advice note indicating the quantity and description of goods sent by a named ship.

(b)   It is a receipt of goods in good condition on board, signed by the master of the ship. Any damage to goods is noted.

(c)   It is evidence of a contract of carriage between the shipper and the shipowner.

(d)       (i) It is a document of title to goods described therein. This means that the holder of the bill of lading can claim the goods when he hands it over to the Port Authority at the port of discharge.

(ii) When delivery of goods has taken place, all other copies of the bill of lading are rendered invalid.

(e) Since it is a document of title it can be used as a basis for negotiating for a letter of credit from the bank.

(f)        (i) It informs the customs authorities of the type of imports/exports and the country of origin or destination respectively.

  (ii) It allows the customs to see at a glance whether the imports or exports are taxable.

              (iii) It helps in the recording of statistics.

(g) It may be used as a document in support in the event of an insurance claim.