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The bill of lading is a legally binding document that provides the carrier and the shipper with all of the necessary details to accurately process a shipment. In Canada, the bill of lading requirements are established by each jurisdiction, although there is uniformity in the requirements.
A bill of lading (BL or BOL) is issued by a motor carrier to a shipper that details the type, quantity, and destination of the goods being carried. A bill of lading also serves as a shipment receipt when the carrier delivers the goods at a predetermined destination. This document must accompany the shipped products, no matter the form of transportation, and must be signed by an authorized representative from the carrier, shipper, and receiver.
A bill of lading has three main functions:
Types. There are several types of bills of lading. Some of the most common include:
Importance. The importance of a bill of lading lies in the fact that it’s a legally binding document that provides the carrier and the shipper with all of the necessary details to accurately process a shipment. This implies that it can be used in litigation if the need should arise and that all parties involved will take great pains to ensure the accuracy of the document. Essentially, a bill of lading works as undisputed proof of shipment. Furthermore, a bill of lading allows for the segregation of duties that is a vital part of a firm’s internal control structure to prevent theft.
Purpose. A bill of lading has three main purposes. First, it is a document of title to the goods described in the bill of lading. Second, it is a receipt for the shipped products. Finally, it represents the agreed terms and conditions for the transportation of the goods.
Contents. Typically, a bill of lading will include the names and addresses of the shipper (consignor) and the receiver (consignee), shipment date, quantity, exact weight, value, and freight classification. Also included are a complete description of the items, including whether they’re classified as hazardous; type of packaging used; any specific instructions for the carrier; and any special order tracking numbers.
Bill of lading vs. Invoice. A bill of lading is a legal document between a shipper and a transport company (carrier) that spells out the type, quantity, and destination of the goods being transported. An invoice tracks the sale of goods between a buyer and a seller.
A bill of lading is a contract issued by a transport company to a shipper that spells out the quantity, type, and destination of the goods being shipped. It serves as a receipt of the shipment and can help prevent the theft of goods being transported. It’s crucial to understand the different types of bills of lading to ensure that the right ones are chosen. If not, your shipment will likely be delayed.