Bill of lading -II

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 Switch Bill of lading
• A “Switch” bill of lading is NOT another type of Bill of Lading..
 A Switch Bill of Lading is simply the second set of bill of lading that
may be issued by the carrier “in exchange of” or “substituting” the
first set of bill of lading

• Where can a bill of lading be switched and who can request shipping
line to issue switch bill of lading..?
 A bill of lading may be switched anywhere around the world for
shipments from anywhere to anywhere..
 For example in a shipment from New York to Antwerp, the bill of
lading may be switched in London as long as the specific shipping
line has offices in London..
 Usually a switch bill of lading happens in a location that may not be
on the route of the cargo..

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 Switch Bill of lading
• Why do customers(Shippers) require a Switch
bill of lading..??
 When there has been a change in the original trading
conditions ;
 Goods have been resold (probably high-seas sale) and
the discharge port has now changed to another port ;
 The seller (who could be an agent) does not wish the
name of the actual exporter to be known to the
consignee in case the consignee tries to strike a deal
with the exporter directly ;
 The seller does not want to know the buyer to know the
actual country of origin of the cargo …
 So seller requests that the port of loading be shown as
some port other than the one the cargo was loaded from.
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 Switch Bill of lading
• What can and cannot be changed in a Switch Bill of Lading..??
• The only safe area that can be allowed to be changed in the
switch bill of lading is the shipper, consignee, notify
information which is usually displayed in Part 1 of the bill of
lading.
• The below details should never be allowed to be changed
• Place and date of shipment as changing this could affect the terms
of delivery based on the sales contract
• Details of cargo including the number of packages, dimensions,
weight and measurement
• Hazardous cargo information if any (remember cargo is already on
board based on original hazardous cargo declaration)
• Reefer cargo information such as temperature setting, humidity
settings etc (remember cargo is already on board based on original
cargo declaration)
• OOG Cargo information if any (remember cargo is already on board
based on original OOG details declared including lost slots
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calculation etc)
• Switch Bill of
Standard/Normal lading that
Clauses (Original clause
appear on aof
billBill
ofof lading)
lading can’t be
changed (For eg.)
• Shippers Load, Stow and Count (SLAC) – Shipping line is saying that
the shipper has loaded, stowed and counted the contents.
• Said to Contain or STC – Shipping line is saying that based on the
shippers declaration, the container is said to contain XYZ cargo and
they haven’t verified the contents..
• Shipped on Board – Shipping line is confirming that the container
has been loaded on board the ship mentioned in the bill of lading
• Received for Shipment – Shipping line is confirming that the
container has been received by them under their control for
shipment on a nominated vessel
• Freight Prepaid – Shipping line is certifying that the freight for the
carriage of the cargo has been paid at the origin port
• Freight Collect – Shipping line is certifying that the freight for the
carriage of the cargo has to be paid at the destination port
• Freight Payable at XXXXXXX – Shipping line is certifying that the
freight for the carriage of the cargo
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location
 Switch Bill of lading
• In order to protect themselves from any possible claims arising out
of issuing switch bills of lading, the shipping line/agent have to
ensure that
1. They are covered by their insurance for the issuance of such switch
bills of lading and they provide their insurance company with the
exact reason for the issuance of the switch bill of lading ;
2. They need to ensure that the bill of lading is switched before hand
over of cargo and also that the person or entity requesting for the
switch bill is authorized to make the request..
3. If a negotiable bill is issued, generally the shipper on the bill of
lading has the right to request for the switch bill of lading, but only
before the endorsement to the next party or delivery of the goods ;
4. All issued originals from the first set of bills must be returned to the
carrier, and cancelled before the bill is switched and a second set is
issued..
5. Point 4 is perhaps the most important point for the carrier to note
and ensure as this is the only way to guarantee that there are no
other originals floating around for 6 the same shipment.. The dangers
of two sets of original bills in circulation for the same cargo are
 Switch Bill of lading
• In order to protect themselves from any possible claims arising out
of issuing switch bills of lading, the shipping line/agent have to
ensure that…….
 This is also required to ensure that the party making the request is
truly the owner of the cargo;
 A shipping agent should never issue a switch bill of lading of their
own wish based on the request of the customer and must always
issue it only with the written authority of the principal (however
urgent the situation may be to the customer) ;
 The switched set should not contain any information different to
that of the first set of bill of lading, (like an incorrect port of loading,
or change in the condition and quantity of the cargo)..
 If switch bills contain any misrepresentations, the carrier/agent will
be at risk of claims from parties who have suffered a loss because
of such misrepresentations ;
 If the agent has been asked by the principal to issue the switch bill
of lading based on an indemnity from the customer(Shipper), the
agent should ensure to get the wording format from the principal
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and get the completed indemnity approved by the principal before
 Difference between Ocean, Sea Waybill and Memo BL
• Ocean Bill of Lading is a B/L issued by the carrier to their customer
(shipper) after the payment of all charges and submission of all
customs/port documents relevant to that country.
• An Ocean Bill of Lading is a Negotiable document which serves also
as an Evidence of Contract of Carriage, Receipt of Goods and
Document of Title. (3 originals + 6 non-negotiable copies)
1. Using an Ocean Bill of Lading, shipper has the option to consign the
shipment to either to a direct customer (in this case the bill of
lading becomes a Straight Bill of Lading and is no longer Negotiable
although it still retains the other two characteristics of a Receipt of
Goods and Evidence of Contract of Carriage) or
2. To Order of a customer(Consignee)
3. To Order of a Bank
4. To Order of Shipper (To Order)
• This bill of lading when consigned to either of the last three
mentioned parties, allows the goods to be endorsed to another
party in case the original buyer decides to resell the cargo..
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 Difference between Ocean, Sea Waybill and Memo BL….
• A Sea Waybill of Lading is NOT a Negotiable document as there is
NO ORIGINAL ISSUED.. It is also NOT a Document of Title.
• This document is more relevant for non-commercial transactions,
inter company sale or where there is no involvement of any
documentary credits.
• A Sea Waybill of Lading CANNOT BE CONSIGNED ‘TO ORDER’ of
someone else.
• It has to be consigned to a direct customer only. Delivery of cargo
covered under a Sea Waybill of Lading can be made ONLY to the
consignee on the bill of lading or his authorized representative.
• A Sea Waybill of Lading (Express Release)is usually issued :
• when the shipper and consignee are part of the same business
group and there are no negotiations required between the two
either directly or via bank for release of the cargo
• the shipment doesn’t involve any bank and the shipper doesn’t really
need to submit original bill of lading to secure his payment
• Memo Bill of lading (without freight value , only a receipt)
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 Difference between HBL and MBL
1. A House Bill of Lading (HBL) is issued by an NVOCC operator, or a
Freight Forwarder to their customers..
2. A Master Bill of Lading (MBL) is issued by the Shipping Line
(Carrier) to the NVOCC Operator, or Freight Forwarder..
 In the HBL
 the Shipper will usually be the actual shipper/exporter of the cargo
(or as dictated by the L/C)
 the Consignee will usually be the actual receiver/importer of the
cargo (or as dictated by the L/C)
 the Notify could be the same as Consignee (or any other party as
dictated by the L/C)
 In the MBL
 the Shipper will usually be the NVOCC operator, or their agent or
the Freight Forwarder..
 the Consignee will usually be the destination agent or counterpart
or office of the NVOCC operator, or the Freight Forwarder
 the Notify could be the same as 10 Consignee or any other party..
 Bill of lading
• Who should endorse a bill of lading for cargo release..?
• For the release of cargo at destination and for the
purpose of documentary credit negotiations, there are
several endorsements required on a bill of lading..
• Whether it is HBL or MBL, it must be understood that a
bill of lading has to be consigned properly in order that
the cargo is released to the correct party..

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Bill of Lading consigned to
• AWho should endorse
Company/Individual Name
To Order or To Order of ZYX
To Order of Bank
Endorsements Required on the bill of
Bill of lading
lading
a bill of lading for
Whencargo release..?
consigned to a named consignee,
the bill of lading is known as a Straight
Bill of Lading, and in the case of a
Straight Bill of lading, the release maybe
given only to the named consignee and
this bill of lading is not negotiable or
transferable..
Shipper’s endorsement stating DELIVER
TO THE ORDER OF “ZYX Client” and
ZYX’s company stamp and sign in case
he is taking the final delivery or his
endorsement stating, DELIVER TO THE
ORDER OF “ABC Client” (if the cargo has
been further sold)….
Shipper’s endorsement stating DELIVER TO
THE ORDER OF “XYZ BANK” and banks’
endorsement stating, DELIVER TO THE ORDER
OF “ZYX Client” and ZYX’s company stamp and
sign in case he is taking the final delivery or his
endorsement stating, DELIVER TO THE ORDER
OF “ABC Client” (if the cargo has been further
12 sold)..
 Bill of lading
• Who should endorse a bill of lading for cargo release and how
should a HBL and MBL be consigned..?
• When there is an involvement of HBL, the MBL can only be a Sea
Waybill or a Straight Bill and will invariably be consigned as below
• Shipper will be : Freight Forwarder or NVOCC
• Consignee will be : The agent of the freight forwarder or NVOCC..
But this could vary from country to country as some countries need
the actual consignee information on the MBL
• Notify will be : The agent of the freight forwarder or NVOCC
• Since a Sea Waybill is neither negotiable nor transferable, there is
no need need for any endorsements on the MBL and cargo will be
released to the consignee..
• If the HBL is used as the transport document, then the HBL should
follow the endorsements as shown above..

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 Notify party inBill of lading
• Who is a notify party in a shipment and what is their role..?
• The details of the notify party are provided in the shipping
instruction submitted to the shipping line. There may or may not be
a relationship between consignee and notify party or shipper and
notify party..
• Instances of who can be shown as Notify Party on a bill of lading
could be :
• Actual receiver of the cargo may be shown as the notify party in instances
where a bill of lading is consigned To Order, so that they are aware when the
shipment is expected to arrive at destination..
• Agent of the consignee who could be either a Freight Forwarder or a
Clearing Agent who is nominated by the receiver of the cargo to arrange for
the receiving, clearance and delivery of the cargo..
• Trader or indenting agent that brokered the deal/shipment and who would
like to keep a track of the shipment..
• Any other entity that has an interest in knowing the arrival and delivery of the
shipment and may have a direct or indirect interest in the system..
• The main responsibility of a Notify Party is to receive the Arrival Notification
from the shipping line and take further
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clearance agent to do the clearance with customs.
 Manifest
• A manifest is one of the key documents in the process of shipping.A
manifest lists all bills of lading issued for cargo loaded on a specific ship.
• A manifest lists the details of the cargo, the shipper, consignee, weight,
measurement, packing..
• There are different types of manifests:
• Cargo Manifest – lists all information relating to the cargo excluding the
freight charges..
• Freight Manifest – lists all information relating to the cargo including the
freight charges.. All charges as indicated in the manifest are either to be
paid by the shipper or consignee..
• Dangerous Cargo Manifest – a manifest that details the dangerous/
hazardous cargoes on board the ship covering the Class, UN No., Description
of Goods, EMS/MFAG etc..
• Out of Gauge Manifest – a manifest that details the out of gauge (abnormal
sized) cargoes on board the ship including the out of gauge details of the
cargo
• Reefer Manifest – a manifest that details the reefer cargoes on board the
ship including the temperature settings, humidity, which containers require
monitoring on board – like cold treatment containers.
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 How to calculate CBM and Freight Ton
• Firstly CBM stands for CuBic Meter.. This is the most common unit used for
the measurement of volumetric cargo.
• Metric Tons as you know refers to the weight of cargo (1 Metric Ton = 1000
Kilograms)..
• Freight Ton or Revenue Ton is derived by calculating the weight or volume of
the cargo and the freight is charged based on whichever is higher..
• When you have the dimensions of the package, first of all convert the
measurement into meters.. Normally dimensions are in Length x Width x
Height..
• If for example the dimensions of a cargo crate is
• 3.2 x 1.2 x 2.2 meters then the CBM is simply 3.2 x 1.2 x 2.2 = 8.448 CBM.
• As mentioned above, if the rate is quoted as for example USD 12/per freight
ton and the weight of the package is 1200 kgs = 1.2 tons, then the freight
rate for this will be
• 8.448 cbm x USD.12 = USD 101.376 or
• 1.2 tons x USD.12 = USD.14.4
• Since the CBM rate is higher, the freight rate of USD.101.376 will apply.

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 Difference between Detention and Demurrage
• Demurrage relates to cargo (while the cargo is in the container)
• Detention relates to equipment (while the container is empty after
unpacking or before packing)
• Imports
• Exports

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