What is a Bill of Lading? Problems and solutions

Bill of Lading 

Bill of lading is a legal document that's issued by a carrier to a shipper detailing the type, quantity, and destination of the goods being carried. A bill of lading is a document of title, a receipt for shipped goods, and a contract between a carrier and a shipper.

Types of Bills of Lading

Some of the most common types of bills of lading include:

Inland bill of lading

Ocean bill of lading

Through bill of lading

Negotiable bill of lading

Non negotiable bill of lading

Claused bill of lading

Clean bill of lading

Uniform bill of lading

Why Is a Bill of Lading Important?

A bill of lading is a legally binding document that provides the carrier and the shipper with all the necessary details to accurately process a shipment. It can be used in litigation if the need should arise and all parties involved will make a committed effort to ensure the accuracy of the document.

A bill of lading essentially works as undisputed proof of shipment. It allows for the segregation of duties that is a vital part of a firm’s internal control structure and to prevent theft.

The problem : Eliminating paper and manual intervention

The Bill of Lading (B/L) is the most important trade document in container shipping. Currently, stakeholders along complex supply chains using original B/Ls (OBLs) must physically courier the original documents to the importer so they can present them at the time of goods collection, which is inefficient, expensive and creates opportunities for fraud. Even with an electronic Telex release for OBLs or paperless Seaway Bills (SWBs), the lack of standard data formats and processes creates confusion that contributes to shipping discrepancies, operational delays, financial losses, and higher costs.  

The solution

The DCSA Digital Trade initiative was designed to facilitate universal acceptance and adoption of a standards-based electronic Bill of Lading, applicable to both original Bill of Ladings and Seaway Bills. Using open source Application Programming Interfaces (APIs), DCSA B/L standard enables straight-through processing of B/L data, eliminating paper and manual intervention from B/L processes. Standardised digitalisation of B/L data and processes will help create a more secure, agile and sustainable supply chain ecosystem. DCSA is also working closely with eBL solution providers on technical and legal interoperability to enable seamless digital transfer of original B/Ls across different platforms and stakeholders, which will facilitate the global uptake of B/L standards.  

The benefits

Optimise your supply chain with DCSA's Bill of Lading standard, enable frictionless sharing of digitised shipping data and improve efficiency of your shipment documentation and operations.

Increased efficiency

Reduce the time required for the documentation process, enabling more efficient cargo handling and customs clearance.

Reduced costs

Reduce expenses related to printing, handling, storage, and transportation of physical documents. 

Increased accuracy

Enhance the overall accuracy of shipping and logistics processes by minimising errors associated with manual data entry, illegible handwriting and lost documents.  

Fraud prevention

Enhance the security of shipping documents with digital signatures, encryption technologies and authentication mechanisms to ensure that the information in the B/L is tamper-proof.

Streamlined compliance

Adherence to B/L standards can contribute to improved compliance with regulatory requirements. 

Greater supply chain resilience

Gains to the Global Trade

In a recent study, McKinsey estimates that if the electronic bill of lading gains 100% adoption across the industry, it could unlock around $18bn in gains for the trade ecosystem through faster document handling and reduced human error (among other improvements) plus $30-40 billion in global trade growth, as digitalisation reduces trade friction.