Banks, especially in letter of credit transactions, do not accept presentation of a FBL instead of a marine bill of lading, unless FBL is signed by the freight forwarder "as carrier" or "as agent on behalf of the carrier"or else presentation of FBL expressly permitted in the letter of credit.
Likewise a CPBL can only be acceptable if letter of credit requests presentation of a Charter Party Bill of Lading.
Why banks do not like FBL and CPBL?
In situations, where banks pay the letter of credit amount in advance long before they have received any money from their clients, they would like to secure the goods as a collateral against their expenses and risks.
In respect to issuing banks perspective, negotiable bill of lading is the most reliable transport document, which protects issuing banks rights over the goods.
Advantages of a Negotiable Bill of Lading Over Freight Forwarder's Bill of Lading and Charter Party Bill of Lading:
Negotiable bill of lading, which is issued by the carrier or a named agent on behalf of the carrier, is a direct evidence of contract of carriage, that is established between the carrier, who is also the shipowner in this case, and the consignee.
Neither FBL nor CPBL evidence actual carrier's or shipowner's contract of carriage terms and conditions.
FBL printed on freight forwarder's bill of lading format and only states the terms and conditions of the forwarding company, as a result consignee will not be having a legal protection in case the goods are damaged or lost in transit.
Additionally consignee may not be able to collect goods from the carrier at the port of discharge by surrendering FBL to the carrier, in case Freight Forwarder and carrier are in a financial dispute.
CPBL is a short form or blank back bill of lading type, which references charter party contract for the carriage of the goods. In case shipowner could not get his payment from the charterer for hiring of the vessel, he can demand the vessel back from the charterer and claims freight to be paid himself instead of the charterer.
Additionally shipowner could extend the lien to cargo on board of the vessel.