Introduction to Straight Bill Of Lading (BOL)

A Bill of Lading (BL or BOL) is a document that specifies the type, amount, and location of the items being transported by a carrier. It is issued by the carrier to the shipper.

In general, a BOL is negotiable. A negotiable bill of lading refers to a document whose title can be changed, i.e., the ownership of the commodities can be changed from one party to another. One can transfer the ownership of the shipment to another party by signing the bill. In a negotiable bill of lading, the new consignee is free to transfer the ownership of the commodities to another person.

However, some BOLs are non-negotiable. Such a BOL is referred to as a straight bill of lading. The consignee's name on this bill cannot be changed later; therefore, it is impossible to transfer legal title and ownership of the freight with this bill.

A straight BOL is used when delivering items that have already been paid for. Here, the goods can only be delivered to the consignee upon identification.

Components of a Straight BOL

A straight BOL has various components. The following is a list of the same and the information that should be filled:

Components of a Straight BOL

The Working of a Straight BOL

In a straight BOL, the seller commits to using a particular mode of transportation to provide the products to a given place, and the bill is then assigned to a specific party. Given the non-negotiable nature of straight BOL, it cannot be assigned to anyone else.

The shipping business turns over the items once the party produces valid identification, this is typically prearranged. A consignment BOL or sea waybill are other names for a straight bill of lading.

A Straight BOL will never have the words “ Straight bill of lading” but will mention “Ocean bill of lading” or “Port bill of lading.”

Also Read: Surrender Bill of Lading (BL) in shipping

Importance of a Straight BOL

Similar to how a receipt would guarantee that you made the purchases you claim to have made at any retail establishment, a straight BOL is intended to safeguard you. It is a title document and proof of your shipping agreement with the carrier. If there are any questions, you can back everything up with documentation.

Importance of a Straight BOL

The Uses and Functions of a Straight BOL

A straight BOL is typically used to transport goods to consumers who have already made payments. Hence, a straight BOL is the most straightforward when dealing with gifts, contributions, and other products that don't involve exchanging amounts.

Where to Obtain or How to Procure a Straight BOL

Once the shipper and consignee agree upon using a straight bill of lading, the shipper gets a straight bill of lading issued by the carrier.

Three bills are often issued: one for the shipper, the consignee, the bank, the broker, or other third parties. It is often referred to as a set of 3 BOL.

What are the Risks of using a Straight BOL?

When using a straight BOL, the buyer is not required to provide the original BOL to receive the goods. This causes several potential problems.

For example, if payment methods such as letters of credit and cash against documents have been used as a payment agreement, no transfer of payment has actually been made. This makes banks vulnerable to credit risks as the consignee can collect their goods without making good on their payment terms.

Another potential problem arises from the contention of whether the consignee needs to produce the original BL for collecting the goods or not. Certain international court rulings have specified that even straight BLs require “delivery upon presentation” of the BL, so consignees that are not prepared with the documentation could have to wait.

Additionally, there seem to be some lack of clarity over rights, liabilities, and applicability of the Hague Visby Rules surrounding the straight BL.

What are the benefits of using Straight BOL?

Because the buyer or importer can obtain the goods immediately from the carrier without providing the original bill of lading, some demurrage and detention fees are reduced. When there are no disagreements between the parties regarding payment and the transit time appears short, this can be very advantageous for both exporters and importers.

Also Read: What is A Master Bill of Lading? Meaning, Requirements & Example

What's the difference between the Straight BOL and the Bill of Lading?

The main differences between a regular BOL and a Straight BOL lie in the negotiability and payment.

difference between the Straight BOL and the Bill of Lading

Tracking a Straight Bill of Lading

The process for tracking a straight BL is pretty much the same as that of a standard BL, the real-time position is fetched from the shipping carrier, in the same manner as a Master BL. Bear in mind, avoid using the house bl for tracking as that’s a document issued by the forwarding agent and not the shipping company.