How to Complete a Bill of Lading and a Shipping Instructions? Step by Step Explanation with Examples

Bill of lading is a generic name of a transport document, which is used when goods are carried out via sea shipments.

Today's complex economic activities and modern transportation industry created a ground for the development of different types of bills of lading to be used in different situations.

Forwarder's bill of lading, charter party bill of lading, multimodal bill of lading, negotiable bill of lading, sea waybill etc. are some of the most frequently issued bills of lading types.

Regardless of what types of bill of lading you may face, you can be benefited from today's article, as I will try to explain how to complete a bill of lading in a very plain text with examples.

What are the differences between a multimodal bill of lading and a bill of lading?

Bill of lading and multimodal bill of lading are two important transport documents. They are frequently used in international trade.

Exporters and importers should be expecting to receive one of these transport documents from carriers, especially when they choose to use sea transportation.

Sometimes, it is not easy to distinguish a bill of lading from a multimodal bill of lading, even for experienced shippers.

Today, I will show you how to seperate a bill of lading from a multimodal bill of lading. But first of all, you need to understand the importance of the shipment coverage, such as port-to-port shipments and door-to-door shipments.

Let me start with the definition of a port-to-port shipment.

What is a Port-to-Port Shipment?

Port to port shipment can be defined as a single mode sea freight transportation, which is started at the port of loading and ended at the port of discharge.

Bill of lading is the transport document which is exclusively used in port to port shipments. It is sometimes called as ocean bill of lading or marine bill of lading.

What are the differences between clean bill of lading and claused/dirty bill of lading?

Clean bill of lading is a type of transport document, which indicates no clause or notation expressly declaring a defective condition of the goods or their packaging.

Claused bill of lading, sometimes referred as unclean bill of lading or dirty bill of lading, on the other hand, indicates that the goods that loaded on board of the carrying vessel, have some apparent defects.

Today, I would like to mention the differences between clean bill of lading and unclean/dirty/claused bill of lading.

But 1st of all I need to address couple of important topics in regard to this subject. 

Clean Bill of Lading | Dirty Bill of Lading Differences
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Who can sign a charter party bill of lading as per UCP 600?

Letter of credit rules give special attention to transport documents.

If you read the latest version of letter of credit rules, UCP 600, you will realize that all transport documents have been specified in very detail.

UCP 600 rules define by whom each transport document must be signed in order be acceptable under letter of credit transactions.

For example UCP 600 article 20 states that a bill of lading, however named, must appear to indicate the name of the carrier and be signed by the carrier or a named agent for or on behalf of the carrier, or the master or a named agent for or on behalf of the master.


Today I would like to explain by whom a charter party bill of lading should be signed as per UCP 600?

Is it possible to submit a charter party bill of lading instead of a marine bill of lading under a letter of credit payment?

Letter of credit rules define different types of bills of lading.

Multimodal bill of lading, marine bill of lading, non-negotiable bill of lading and charter party bill of lading are different types of bills of lading, which have been defined by UCP 600.

Please keep in mind that UCP 600 is the latest and current version of L/C rules.

Exporters and importers as well as bank personnel should understand the details of letter of credit rules very well, otherwise they make costly mistakes.

Today I would like to explain whether a charter party bill of lading can be presented instead of a marine bill of lading under letter of credit transactions.


What is a charter party bill of lading?

International sea freight transportation can be divided into two main categories:

Containerized cargo shipping and dry bulk cargo shipping.

Containerized shipping deals with relatively small scale cargo shipments.

Electronic goods, processed packed foods, textiles, mobile phones, furniture and almost every manufactured products are examples of typical goods that can be carried by container vessels.

Shippers of the containerized cargo receive ocean bills of lading as a transport document from the container vessel carriers.
Bulk shipping deals with huge cargo shipments.

Coal, sugar, timber, copper, iron ore, chemicals are the main examples of goods that can be carried by bulk vessels.

Shippers of the bulk cargo receive charter party bills of lading as a transport document from the owners or charterers of the break bulk vessels.

Today I would like to explain the core elements of a charter party bill of lading.

What is a straight bill of lading?

You have to be very carefull when completing the consignee field of a bill of lading, because it does not only define to whom the goods should be delivered, but also explains delivery procedures of the consignment.

If the bill of lading issued in a negotiable form, to order (shipper) or to the order of a named party, at least one original bill of lading must be surrendered to the carrier's agent at the port of discharge in order to get the consignment.

But what happens if a bill of lading not issued in negotiable form by simply completing the consignee field writing direct consignee's name and address. 

On this article I will be explaining the straight bill of lading, which is a type of bill of lading that is issued in a non-negotiable form.


How to complete consignee and notify fields of a bill of lading?

Today on this post, I will be explaining with examples one of the key elements of a bill of lading in international trade.

Bill of lading is a negotiable transport document, only when it is issued in a negotiable form.

Negotiable bill of lading plays a key role in international export-import transactions, where the exporter or exporter's bank does not want to release the goods to the importer without surrendering at least one original bill of lading to the carrier's agent at the port of discharge.
Today on this article I will try to answer below questions:
  • What is a negotiable transport document? 
  • What are the differences between negotiable bill of lading and non-negotiable bill of lading? 
  • How does a bill of lading could be issued in a negotiable form? 
  • What is a consignee field on the bill of lading? 
  • What is a notify field on the bill of lading? 
  • How to complete consignee and notify fields of a bill of lading? (explanations with examples)

What does cy/cy mean on a bill of lading?

Bill of lading, which is a transport document evidences receipt of cargo, contract of carriage and represents title of goods, is mostly used in international port-to-port sea shipments.

A bill of lading should normally state the port of loading and port of discharge.

Port of loading is the place where the goods are shipped on board a vessel. Port of discharge is the place where the vessel is off-loaded and the goods are distributed to their respective consignees.

Some bills of lading contain "cy/cy" term in addition to port of loading and port of discharge.

Today I would like to explain the meaning of "cy/cy" term as seen on the bills of lading.

Can an air waybill be issued to order of an issuing bank?

Transport documents are one of the most important document types in international trade business.

They not only evidence receipt of cargo but also contract of carriage as well.

Additionally some transport documents title to cargo such as negotiable bills of lading.

Unlike bill of lading, air waybill is not a negotiable transport document, as a result it cannot be issued in negotiable form, which means that air waybill cannot be issued "to order of the issuing bank".
Today I want to explain what does negotiable transport document mean in export and import business and why an air waybill cannot be issued "to order of the issuing bank".

What are the differences between air waybill and bill of lading?

Bill of lading and air waybill are two transport documents, which have been widely used in international trade businesses for decades.

Air waybill is a transport document, which is used in airport-to-airport air shipments.

Bill of lading is the generic name of transport documents, which are generally used in port-to-port sea shipments.

There are various types of bills of lading available on the market, each of them fulfilling different needs.
Today I would like to mention the differences between these two important transport documents.

Shipped on board and clean on board bill of lading

I would like to explain the difference between shipped on board bill of lading and clean on board bill of lading on this page. 

The reason I would like to write about this topic is that some issuing banks demand "shipped on board" bills of lading, whereas others demand "clean on board" bills of lading under "letters of credit" payments.

Exporters are getting confused, when carriers issue a "shipped on board" bill of lading where the letter of credit requires a "clean on board" bill of lading or vice versa.


What does shipped on board mean on a bill of lading?

Bill of lading is a traditional transport document, which has been issued by the carriers for sea shipments that has been taken place between one sea port to another.

Historically, there are two main types of bills of lading available on the market in terms of scope of issuance.
  • Received for shipment bills of lading 
  • Shipped on board bills of lading
Today I would like to explain the meaning and function of an on board bill of lading and received for shipment bill of lading.

Should the container number be mentioned on the packing list?

Transporting goods by sea in containers plays a very significant role in international trade. 

In the past 60 years, containers have become the primary means of transport of customer goods by sea. 

At the moment millions of containers circulated around the world every year. 

Tracking and tracing these containers is one of the most important security priorities of the custom authorities. 

Development of a standard container number system was a huge response to tackle the container tracking problem in international trade. 


With the help of the globally valid and standard container number, every share holder could trace and identify them fast.

Container tracking system will be most effective when the container number is mentioned on the shipping documents.

Container number is generally inserted on the bill of lading by carriers or their agents on behalf of the carriers as a standard sector practice.

In most instances shippers also add container numbers on the packing list as well. But is this a requirement, a good practice or unnecessary information. 

Let us discuss below.

What is a container number?

If you are not dealing with a fraudulent transaction, you should be able to identify corresponding container number/numbers on the bill of lading as an importer.

But what is a container number? What are the benefits of using a container number in international sea transportation? How to check a container number in order to make sure that the container number is valid and correct? 

On this article I will try to answer these questions. Let us start with the definition of the container number.



What is Standard Carrier Alpha Code (SCAC)?

As an exporter or importer you should have seen SCAC codes on the bills of lading. 

On this article I will try to explain the meaning of SCAC codes. 

After reading this page you should understand the key aspects of SCAC codes in international transportation.

What is SCAC?

SCAC is the abbreviation that stands for Standard Carrier Alpha Code. 

Standard Carrier Alpha Code is a specific code used to identify transportation companies such as freight container carriers and forwarders.

Each transportation company has its own Standard Carrier Alpha Code.


What does “Said to Contain” (STC) mean on a bill of lading?

Said to contain means that the shipper that has loaded the goods into the container has done his best to make sure that the goods which are loaded into the container are matching the description of goods stated on the bill of lading in a containerized shipment. 

Because of the fact that carriers could not know exactly what would have been loaded into the containers, they add this expression on the face of the bills of lading that they have issued in order to protect themselves.

A carrier or a forwarder has no knowledge of the contents of the container unless the container is stuffed by the carrier, forwarder or their agents. 

The shipper that has loaded the goods into the container should take necessary steps to ascertain the contents of the container.

"Said to Contain" or “STC” generally added to the description of the goods on the bill of lading. 

This term means that the content of a sealed container received by the carrier as is without any additions. 

What is a straight bill of lading? What are the differences between straight bills of lading and bills of lading?

Bill of lading is a traditional transport document. 

It has been in use since the old days when vessels were really slow comparing to modern container carriers.

Even in 19th centuary, especially shipments from South America to Europe or Africa to Europe took quite significant time. 

Long transportation periods create financial problems for both exporters and importers as finance has always been a key issue for international trade.

International traders and banks managed to find a brilliant solution for this problem. 

They started to implement a payment method which is called letter of credit.

Under a letter of credit payment method, an issuing bank notifies its conditional payment undertaking to the seller in a written format which means that issuing bank sends a letter to the exporter which contains the conditions and requirements of the payment.

Seller could get its money only if he can present required documents in an acceptable way to the issuing bank. 

What Does “Freight Collect” And “Freight Prepaid” Mean on a Bill of Lading?

Various types of transport documents used in international trade.

Bill of lading is a transport document which is used in sea shipments.

A bill of lading is not only a receipt for the delivery of goods, but also contains a contract of carriage.

In traditional form it is also a document of title. Bill of lading as a transport document proves that:
  • the consignor delivers the merchandise to the carrier in good order. 
  • the terms of the carriage is accepted by carrier as indicated on the face of the document. 
  • in a traditional form (negotiable bill of lading) consignor can pass title of goods to another party by means of endorsement or delivery. 
In addition to these information, bill of lading indicates by whom the freight charges will be paid.

“Freight Collect” and “Freight Prepaid” are the terms that used in this regard.

Are there any differences between express bills of lading vs. non-negotiable sea waybills?

We can see that international logistics sector is no shy assigning new names to the transport documents. 

ICC which is the short form of International Chamber of Commerce have noticed this reality and add phrases to its rules books such as UCP 600, ISBP in an effect that the name of the transport document is not a point of consideration. 

Let us have a look at couple of these expressions from UCP 600.
  • A transport document covering at least two different modes of transport (multimodal or combined transport document), however named,
  • A bill of lading, however named, 
  • A non-negotiable sea waybill, however named,