Chapter 9 Shipment Documents
Learning target:
 1. What are B/L and its function?
 2. Key classification of B/L.
 3. What are AWB and its function?
 4. What is the difference between B/L and
AWB?
 5. What is multi-modal transport and the
main document involved?
 Transport
documents can be described as the
receipt evidence issued by carriers to the
exporters and acts as the documents of
necessity for cargo delivery, complaints as
well as settlement or negotiation to banks.
According to different modes of
transportation, shipping documents mainly
refer to marine bill of lading, seaway bills,
airway bills, railway bills, multi-modal
transport documents, etc. This chapter will
mainly illustrate marine bill of lading, airway
bill, airway bill and multi-modal transport
documents.
9.1 marine bill of lading
 9.1.1
Definition and functions of marine bill
of lading
 Marine bill of lading or ocean bill of lading,
abbreviated as bill of lading (B/L), in
accordance with the regulations in Maritime
Law of People’s Republic of China, means a
document which evidences a contract of
carriage by sea and the taking over or
loading on board of the goods by the carrier,
and by which the carrier undertakes to
release the goods against surrendering of the
document.
In accordance with the definition of marine B/L, its
functions are mentioned below:
 B/L is evidence of the contract of carriage between
the consignor and the shipping company. The rights
and obligations of the two parties are listed on the
B/L.
 B/L is a receipt for the goods issued by the ship
owner or his agent evidencing the receipt of the
goods mentioned in B/L.
 B/L is a document of title to the goods. Any lawful
holder of B/L may take the delivery of the goods
from the shipping company against the B/L, or
transfer the title to the goods by transferring the B/L
or secure loans against the B/L from the bank before
the arrival of the shipment.
9.1.2 Parties in marine bill of lading
Parties in marine bill of lading include carrier, shipper,
consignee, notify party, transferee and the bearer.

Carrier. Carrier refers to such persons who sign the
shipment contract with shipper as shipping
company or charterer without shipping vessel.

Shipper. Shipper is the party who reach the
shipment contract with carrier. Shipper could be
the consignor or the consignee in accordance with
the trade terms.

Consignee. Consignee may be the payee, bearer or
the specified person written in named B/L.
Importer is often the consignee.
 Notify
party. Notify party is the target one
who is informed by the shipping company the
arrival of shipment. Notify party could be
importer or its agent.
 Transferee. Transferee is the receiver of B/L
after the endorsement or transfer and could
claim the shipment to the carrier.
 Bearer. Bearer is defined as the legal holder
of B/L. The holder could be the consignee or
the assignee.
9.1.3 Contents of bill of lading
The contents of a B/L consists of every liner company in
the world has its own B/L form and clauses, but the
basic contents are stipulated according to the
International Convention for the Unification of
Certain Rules of Law Relating to Bill of Lading. See
B/L sample (9-1) for reference.
 On the face of the B/L, the following particulars are
to be noted:
 Consignor /Consignee/Party to be notified/Name of
the vessel/Ship’s nationality/Voyage/Port of
shipment and port of destination/Freight
 Number
of the copies of the B/L, date,
signature of the ship-owner or his agent or
capital of the steamer.
 Main particulars regarding the goods loaded
on the steamer: description, marks, number
of package, weight or measurement.
 Declaration shall be made that the goods
have been loaded on board in apparent good
order and should be discharged at the port of
destination or the port as near as the vessel
may safely get and be always afloat.
9.1.3.2 Clauses on the back of B/L

Clauses on the back of B/L can be classified into
compulsory and non-compulsory. Compulsory clause
restrains parties in B/L from breach maritime laws,
international convention and harbors practices
related. Non-compulsory clause is regulated by the
carrier to define those which are not concluded
adequately in compulsory clause. Clause on the back
of B/L constitutes the evidence of liabilities and
obligations and disputes settlement for parties
involved in B/L. The contents of back clause are
various for every signal carrier but normal contains
the following items:
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Definition for merchant;
Paramount clause for dispute settlement;
Jurisdiction Clause
Carrier’s responsibility and period of responsibility
clauses;
Exception and claim clauses;
Packing and mark clause; Freight clause; Lien clause
Transshipment clause; Discharging and delivery clause
Animals, plants and on deck cargo clause
Dangerous cargo clause
9.1.4 Key classification of B/L
9.1.4.1 shipped on board and received bill of lading
 Criteria vary and classification of B/L could be
various. According to whether the goods have been
loaded on board the vessel, the B/L is divided into
shipped on board B/L and received for shipment B/L.
 A shipped on board B/L is evidence that the goods
have been loaded on board a certain steamer.
According to general trade practices, only the
shipped on board bill of lading is accepted by banks
for payment under a letter of credit.
 A received for shipment B/L is evidence given by the
ship owner that the goods have been received for
shipment but have not yet been actually loaded on a
particular ship. It is therefore uncertain whether the
goods would be shipped or loaded on board a vessel
within a short period of time.
9.1.4.2 clean B/L and unclean B/L.
 According to whether there are notes on the bill of
loading, it falls into two kinds: clean B/L and unclean
B/L.
 A clean B/L shows that the goods have been shipped
on board a vessel in apparent good order or condition.
A clean B/L is issued to the shipper when the goods
do not have any exterior defects at the port of
shipment. Actually on every B/L, there are words
“shipped in apparent good order and condition”. The
carrier will not modify this statement if the goods are
in good order, therefore making the bill of lading
clean. The carrier undertakes full liability for the
goods and will carry and deliver them in the same
good order as he received them. The carrier will be
liable if the goods are found damaged.
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Unclean bills of lading are generally marked
“insufficiently packed”, “carton old and stained”, “--packed in damaged condition” etc. But not all bills
of lading which are noted are unclean bills of lading.
The following kinds are not regarded as unclean bills
of lading.
The notes do not indicate clearly that the goods or
packing are unsatisfactory, e.g., “old packing” or
“old carton” etc.
The purpose of the note is to emphasize that the
carrier shall not be responsible for the risks resulting
from the quality of the goods or packing.
The bank will not accept the unclean B/L until the
buyer agrees accordingly.
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9.1.4.3 named, order and blank bill of lading
According to whether the B/L is transferable, it is
divided into 3 kinds: straight B/L, order B/L, and
blank B/L
A named B/L is made out so that only the named
consignee at the destination is entitled to take
delivery of the goods under the bill. The consignee is
designated the shipper. The carrier has to hand over
the cargo to the named consignee, not to any third
party in possession of the bill. This kind bill of lading
is not transferable. The shipper cannot pass the bill
to a third party by endorsement. So the bill is of very
restricted application. When the goods are shipped
on a non-commercial basis, such as samples or
exhibits, or when the goods are extremely valuable, a
straight bill of lading is generally issued.
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An order bill of lading indicates that the bill is made
out to the order of any person named in such a bill.
This kind of bill may be transferred after
endorsement. When the bill is made out “to order of
shipper” it is necessary for the shipper to endorse the
bill either in blank or in full, to the consignee to
whom he wishes the delivery of the goods is to be
made. If the shipper does not endorse such a bill, he
reserves the right to dispose of the goods to himself.
A blank bill of lading is also called open B/L or bearer
B/L. It refers to the bill in which the name of a
definite consignee is not mentioned. There usually
appear in the box of consignee words like “to bearer”
and the holder of the B/L can take delivery of the
goods against the surrender of B/L.
9.1.4.4 long form and short form of bill of lading
 According to the contents of the B/L, it can be
divided into 2 forms.
 A Long Form B/L refers to the bill of lading on the
back of which all the detailed terms and conditions
about the rights and obligations of the carrier and the
consignor are listed as an integral part of the bill. A
long form B/L is applicable for all countries.
 A short form B/L is a document which omits the terms
and conditions on the back of the B/L. Only America
accepts short form B/L.
9.1.4.5 freight prepaid and freight to be
collected bill of lading
 According to the time for payment of freight,
it can be divided into 2 types.
 A freight prepaid B/L means that all the
freight is paid by the consignor when the B/L
is issued by the carrier.
 A freight to be collected B/L refers to the
B/L on which “freight payable at destination”
is indicated.
9.1.4.6 Master and house bill of lading
 According to the issuance party of B/L, it can
be divided into 2 categories.
 A Master B/L means the B/L is issued by the
actual carrier directly to the consignor.
 A House B/L is issued by NVOCC （Non-vessel
Operating Common Carrier）to the consignor
under the authorization of the shipping
company.
9.1.4.7 Other Types of B/L：Ante-dated, On
Deck and advanced bill of lading
9.1.4.7.1 Ante-dated B/L
 When the actual loading date is slightly later
than the date of shipment stipulated in the
L/C, the carrier sometimes, at the request of
the shipper, will issue the bill of lading to the
shipper an ante-dated B/L so as to meet the
requirement of the L/C. The shipping carrier
does not issue ante-dated bill of lading.
9.1.4.7.2 On Deck B/L
 On Deck B/L is issued when the goods are
stowed on deck. The carrier shall not be
responsible for the damage to and losses of
the deck goods. In accordance with UCP600,
the on deck B/L is not be accepted by the
bank provided that specified in L/C.
9.1.4.7.3 advanced bill of lading
 Advanced bill of lading is issued at the date
which is prior to the shipped on board date.
Similar to anti-dated bill of lading, the
advanced bill of lading is required by the
shipper for meeting requirement specified in
L/C. The shipping carrier does not issue
ante-dated bill of lading.
9.1.5 B/L Maritime Laws and Rules
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International laws and rules critical to B/L are:
General Rules of Law Relating to Bills of Lading
(The Hague Rules) , Protocol to Amend the
International Convention for the Unification of
Certain Rules of Law Relating to Bills of Lading (The
Visby Rules) and United Nations Convention on the
Carriage of Goods by Sea, 1978 (The Hamburg
Rules).
In China, Maritime Law in 1993 was the first law
with regard to maritime transport and carriers. This
law follows the belief of The Visby Rules and
introduces some rational parts in The Hamburg
Rules.
9.1.6 Copies and disposal in case of loss

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Every B/L has its original and negotiable forms in
triplicate and non-negotiable copies. After one of the
original B/L has accomplished the formality of taking
delivery, the others stand null and void. The nonnegotiable copies are only for kind reference.
Provided that the B/L is lost, when claiming cargo to
the carrier, the consignee cannot deliver the goods
until the shipper agrees the consignee with a bank’s
letter of guarantee at hand to certify. The carrier
requires publicly loss of B/L without any dissent for a
certain period of and then releases the cargo to the
consignee.
9.1.8 Essentials of B/L review
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(1) B/L must be clear and shipped on board B/L.
(2) B/L must not show “on deck shipment”.
(3) The head and the endorsement should be in completed
correct.
（4）Loading date, port of loading, port of discharge and
port of destination should be typed in accordance with L/C
regulations. If port of discharge is overlapping, the
country’s name should be added thereafter. And if the port
of discharge is optimal, all port names should be listed as
“OPTION LONDON/ROTTERDAM/HAMBURG" in this item.
The optional ports should not be more than three in
number and be on the same line. Provided that the
shipment is transshipped during the cruise, the port of
discharge should be transshipment port and the final port
of destination should be shown in item “FINAL
DESTINATION”.
(5) Shipment cargo should be the same with
cargo description of invoice.
 (6) Marking should be in conformity with
that of invoice.
 (7) "Freight paid”,” freight prepaid”,”
freight to be collected" must appear on B/L
in accordance with price term specified in
the credit.
 (8) The full set of B/L is a must in case of
ordered B/L.

9.2 airway bill and railway bill

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9.2.1 Definition and function of an Air Waybill
Air waybill (AWB) is a receipt from the airline
acknowledging the receipt of the consignment from
the shipper and a contract of carriage between the
airline and the shipper. An air waybill is equivalent to
an ocean B/L, but it is not a document of title or
negotiable instrument as a bill of lading, as the
consignee takes the delivery of the cargo against of
arrival notice given by the carrier. Hence collection
cannot be used for the payment of the goods to be
transported by air. AWB function can be read as
followed:
 AWB
is a receipt for the goods issued by
airline’s agent evidencing the receipt of the
goods mentioned in AWB.
 AWB is evidence of the contract of carriage
between the consignor and the airline
company.
 AWB is the bill reference charged by the
airline company.
 AWB can be regarded as insurance policy.
 AWB is a must for customs declaration.
 AWB is the reference （Original 2） for air
carrier business operation.
9.2.2 Types of Air Waybill
 According
to the issuer, AWB can be divided
into the two kinds:
 Master Air Waybill (MAWB) means its issuer is
air carrier and the shipping contract between
the air carrier and air freight forwarding
authorized agent.
 House Air Waybill (HAWB) is issued by the
authorized forwarding agent and constituents
the contract between the forwarder and the
consignor.
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9.2.3 Contents of an AWB and its key points
9.2.3.1 Contents of an AWB
Unlike B/L, the contents of an AWB is tiny in difference in
forms, since most airlines take the IATA (International Air
Transport Association ) AWB known as neutral AWB to
regulate the contents of an AWB, which concludes the
following items:
First departure airport IATA code;
Name，address and account No. if necessary of the shipper
and consignee;
Issuing carrier’s agent name, city, IATA code and account
No. if necessary;
Dispatching dates and cruises including transshipment
information;
Cargo description of; freight and rates;
Others for Customs, insurance and handling.
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9.2.3.2 Key points for attention in an AWB
Issuer of an AWB. Provided otherwise stipulated in
L/C, the bank rejects an AWB issued by transport
agencies.
Numbers of an AWB. An AWB has its triplicate originals,
in which original 1 is for issuing carrier, original 2 is
transferred to the consignee accompanying the flight
and original 3 delivers to the shipper for Bill
Purchased (B P).
The consignee indicated in an AWB. Only the
consignee typed in an AWB has the right for cargo
delivery, which should in strict conformity with
regulations in L/C. The right can dully be transferred
to the bank in case of blank indication of consignee in
L/C.
 The
bank will check the airway bill in
accordance with the commercial invoice or
the packing list related in the following
essential aspects:
 1) The consignor, which should be in strict
conformity with the drawer of the
commercial invoice;
2) The consignee, which should be the same with
the buyer in the commercial invoice in terms of
name and address in case no description of the
consignee in the airway bill;
 3) Marks, description of goods, quantity, gross
weight and measurement should agree with
those in the commercial invoice and other
documents;
 4) The air freight and the its payment ( prepaid
or to be collected)；
 5) The signature of the carrier or the carrier’s
agent and the signature’s compliance.

A
Railway Bill ( RWB) or cargo receipt will be
issued when the cargo are transported by rail,
which acts as a contract between railway
carrier at the place of cargo receipt and the
related consignee and the evidence of
liabilities and obligations of parties involved.
 9.2.5
Functions of a Railway Bill
 A Railway Bill is in duplicate and only
functions for transport contract and cargo
receipt.
 9.2.6
Essentials of a Railway Bill
 The bank will check the railway bill in
accordance with the commercial invoice
related in the following essential aspects:
 the consignor, which should be the drawer of
the commercial invoice;
 the
consignee, which should be the applicant
of the L/C, the consignee designated by the
L/C or the buyer in the contract, provided
that the consignee dose not been specified in
the L/C and other documents involved;
 Marks, description of goods, numbers of
items, packing and the total items should
agree with those in the commercial invoice;
 The confirmed weight and the total weight
should be the same with gross weight in the
commercial invoice.
9.3 Multimodal transport
documents
 International
Multimodal Transport derives
from the booming development of
international containerization since 1950.
 9.3.1 Multi-modal Transport and
characteristics
 International Multi-modal Transport is the
transportation of unit loads in such a way
that they can be transferred between two or
more modes successively with the minimum
of remanding by International Multi-modal
Transport Operator （MTO）.
9.3 Multimodal transport
documents
 The
characteristics associated with
International Multi-modal Transport can be
found as the followings:
 Two or more modes of transport must be
adopted, in which maritime shipping is a
necessity.
 MTO is liability for the whole voyage upon
issuing the international Multimodal
Transport Document.

9.3 Multimodal transport
documents
 9.3.2
Characteristics of and contents in
Multi-modal Transport Document
 The multi-modal transport document (M.T.D.)
is a document which evidences the combined
transport contract and indicates that the
multi-modal transport operator shall take
over the goods and shall be responsible for
delivering the document according to the
clause in the contract.

9.3 Multimodal transport
documents
 Characteristics
attributes to the M.T.D. are:
 1) Two or more successive modes of transport
are undertaken;
 2) The liability of M.T.O. ranges from the
receipt to delivery of the said cargo;
 3) The bank can accept the M.T.D. in terms
of vessel name, port of loading and port of
discharge with “intended” and similar
expressions;
 4) FCA、CPT and CIP can make M.T.D.
feasible.

9.3 Multimodal transport
documents
A
M.T.D. should contain the particulars below:
 Cargo description.
 M.T.O. business name and address; receipt
and delivery time and locations;
 Name of consignor and consignee and freight
settlement;
 Transport modes and cruise;
 M.T.D. issuing date and place;
 Negotiability claim.
 Others necessary.
