What is a bill of lading? Why is it important? When is BOL required? (2024)

What is bill of lading?

A bill of lading (BOL) is a legally binding contract of carriage document. It is between a consignor/shipper and a logistics services provider (LSP). The bill of lading reflects the transportation provider responsible for transportation of goods through to the final destination and any conditions for transporting the shipment. Bills of lading are used in land, ocean, and air transportation.

Why bill of lading is important

The bill of lading fulfills three functions. It is a document of title to the goods described in the BOL. The bill of lading form or electronic bill of lading serves as a proof of shipment/receipt when the LSP delivers those goods to a pre-determined destination. The BOL details special instructions and tracking information. It represents agreed upon terms and conditions for the transportation of the goods.

Who issues Bill of Lading?

The bill of lading is issued by an LSP to a shipper to detail type, quantity and destination of goods being transported. A BOL accompanies the shipped products and is signed by an authorized representative from the LSP or carrier, the consignor/shipper, and the receiver.

When is a Bill of Lading Required?

Transportation service providers engaged in the transportation of property other than livestock and wild animals are required by the Federal Motor Safety Carrier Administration to provide a BOL. The shipper must receive it before the vehicle leaves its origin.

What is a Bill of Lading Number?

Each bill of lading includes a unique number issued by the transportation provider. This is the primary number used for tracking a shipment status.

What is the PRO number on a Bill of Lading?

The shipping progressive rotating order number or PRO number is used in over-the-road transportation – less-than-truckload (LTL) and truckload (TL). It is an order identifier that becomes a piece in the tracking and chain of custody process from shipper to consignee. A 7-10-digit number, it is affixed to shipments as a scannable barcode. It identifies and tracks specific orders tendered to particular carriers.

Contents of Bill of Lading

Types of Bill of Lading

Straight BOL

Also known as a non-negotiable bill of lading, it reflects that freight shipment is consigned to a specific person and it can’t be given to another party.

Open BOL

Also known as a negotiable bill of lading. It specifies that a shipment can be transferred from one consignee to another with the consignees’ signature. An open BOL can be transferred multiple times.

Bearer BOL

This states that a delivery will be made to whoever holds the bill. Bearer bills of lading are used for bulk cargo that is delivered in small quantities.

Order BOL

The order bill of lading is the most widely used in the world. It is a negotiable BOL that is made out to, or to the order of, a particular person. It can be transferred by endorsem*nt and delivery of the bill.

Surrender BOL

Surrender bill of lading is issued by exporters, and it allows importers to legally own the items the exporter shipped.

Received for Shipment BOL

Document issued by a transportation provider before a vehicle is loaded as evidence of receipt of goods for shipment.

Shipped BOL

A document issued when cargo is loaded on board, this bill of lading binds the shipowner and the shipper directly.

Clean BOL

Issued by a shipping company without any declarations of damaged goods or packaging.

Through BOL

More complex than most BOLs, this document used in international shipment of goods. It permits the shipping carrier to pass the cargo through several modes of transportation or through several distribution centers. This bill includes an Inland BOL and an Ocean BOL depending on the destination.

Combined Transport BOL

Details information about freight transported across multiple transportation modes, or multimodal, usually including ocean/air, rail, truck, and final mile.

Dirty or Claused BOL

When a transportation service provider has concerns about the cargo’s condition at the time of pick-up, notes recorded about the condition cause the BOL to be “dirty or claused.” Examples: torn packaging, broken cargo, quantity shortage, etc.

Container BOL

A document that gives information about the goods that are delivered in a safe container or containers moving from one port to another.

House or Forwarders BOL

Created by an Ocean Transport Intermediary (OTI) such as a freight forwarder or non-vessel operating company (NVOCC) to acknowledge receipt of goods that are shipped; issued to the suppliers when the cargo is received.

Master BOL

This is a document created for shipping companies by their carriers as a receipt of transfer. It summarizes the contents of a shipment, including the BOL numbers assigned to items within the shipment. It includes a description of the freight under each BOL. It also has terms for transporting the cargo, the name and address of the consignor, the shipper, and the consignee.

Charter Party BOL

They are issued by the charterer of a ship or transportation vessel. This document outlines details about the shipment, such as the types of goods, quantity, and the condition under which the goods are to be transported.

Multimodal Transport/Combined Transport BOL

This is a type of Through BOL that involves a minimum of two different modes of transportation, often sea and over-the-road.

Stale BOL

A bill of lading that is presented to the consignee more than 21 days after the scheduled date of arrival of the shipment.

Short-term or Blank BOL

A document issued when the detailed terms and conditions of the carriage contract are not given on the body or back of the BOL.

How MercuryGate supports Bill of Lading Management

The BOL is important in complex freight invoice processing and financial settlement for freight transportation. Often expensive and error-prone, the settlement process benefits from the MercuryGate platform’s ability to manage and store all shipping and proof of delivery documents in one centralized location.

By supporting this verifiable shipping document, as well as PRO numbers and SCAC information, MercuryGate makes your electronic BOLs quickly accessible. In just a few mouse clicks you can use these files in claims management, shipment monitoring, delivery verification, as well as any financial settlement functions.