A Bill of Lading (B/L) is a core document in international shipping and trade, serving three functions: a receipt for goods, a document of title, and evidence of the contract of carriage. This article introduces the definition, parties involved, functions, negotiability, issuance, and international conventions of the bill of lading to help understand its legal status.
1. Definition of Bill of Lading and Related Parties
Marine Bill of Lading or Ocean Bill of Lading, abbreviated as Bill of Lading (B/L), is one of the most important documents in international settlement. The Hamburg Rules define a bill of lading as: Bill of lading, means a document which evidences a contract of carriage by sea and the taking over or loading of the goods by the carrier, and by which the carrier undertakes to deliver the goods against surrender of the document. A provision in the document that the goods are to be delivered to the order of the document. A provision in the document that the goods are to be delivered to the order of a named person, or to order, or to bearer, constitutes such an undertaking. Article 71 of the Maritime Code of the People's Republic of China (effective July 1, 1993) stipulates: "A bill of lading is a document which serves as evidence of the contract of carriage of goods by sea and of the receipt or loading of the goods by the carrier, and by which the carrier undertakes to deliver the goods against surrender of the document. The provisions in the bill of lading that the goods are to be delivered to a named person, or according to the instructions of the order party, or to the holder of the bill of lading, constitute the carrier's undertaking to deliver the goods accordingly."
The main parties involved in a bill of lading are the two parties to the contract of carriage: the shipper and the carrier. The shipper is the cargo party, and the carrier is the ship party.
2. Functions of a Bill of Lading
A bill of lading has the following three main functions:
(1) A bill of lading is a receipt for goods, proving that the carrier has taken charge of the goods and that the goods have been loaded on board.
For the shipper who delivers the goods to the carrier for transport, the bill of lading functions as a receipt for the goods. Not only is the carrier obliged to issue a bill of lading for goods loaded on board, but also, at the shipper's request, even if the goods have not yet been loaded, as long as they are under the carrier's custody, the carrier is obliged to issue a document known as a "received for shipment bill of lading." Therefore, once a bill of lading is issued by the carrier, it indicates that the carrier has loaded the goods onto the ship or has confirmed acceptance of custody.
As a receipt for goods, the bill of lading not only proves the type, quantity, marks, and apparent condition of the goods received, but also proves the time of receipt of the goods, i.e., the time when the goods were loaded on board.
Originally, when a bill of lading was issued, it was sufficient to prove that the goods had been received and their condition; loading the goods on board was not necessarily required. However, loading goods on board symbolizes the seller's delivery of the goods to the buyer, so the time of loading also means the time of delivery by the seller. Timely delivery is a necessary condition for performing the contract; therefore, using the bill of lading to prove the time of loading is very important.
(2) A bill of lading is a document of title in which the carrier undertakes to deliver the goods against its presentation and which is transferable.
For a holder who legally obtains the bill of lading, it functions as a document of title. The lawful holder of the bill of lading is entitled to take delivery of the goods at the port of destination in exchange for the bill of lading, and the carrier, acting in good faith, may deliver the goods against the bill of lading without liability even if the holder is not the true owner of the goods. Moreover, unless otherwise stated in the bill of lading, the bill of lading may be transferred to a third party without the carrier's consent; the transfer of the bill of lading means the transfer of the title to the goods, and successive endorsements can effect successive transfers. The lawful transferee or holder of the bill of lading is the lawful holder of the goods described therein.
The title to the goods represented by the bill of lading can be transferred with the transfer of the bill of lading, and the rights and obligations stipulated in the bill of lading also transfer with the transfer of the bill of lading. Even if the goods are damaged or lost during transport, since the risk of the goods has already passed from the seller to the buyer with the transfer of the bill of lading, only the buyer can make a claim for compensation against the carrier.
(3) A bill of lading is evidence of the establishment of a contract of carriage of goods by sea.
The clauses printed on the bill of lading stipulate the rights and obligations between the carrier and the shipper, and the bill of lading is also recognized by law as the basis for handling matters relating to the carriage of goods. Therefore, it is often regarded as the transport contract itself. However, under strict legal concepts, a bill of lading does not possess the basic conditions of an economic contract: it is not the product of consensus between the two parties; the clauses binding the carrier and shipper are unilaterally formulated by the carrier; and it is performed before it is issued. Long before the bill of lading is issued, the carrier has already begun various work related to the carriage of goods, such as accepting the shipper's goods for shipment and loading them on board. Therefore, it is more reasonable to say that the bill of lading is merely evidence of the transport contract rather than the transport contract itself.
If a transport contract already exists between the carrier and the shipper before the bill of lading is issued, then regardless of the provisions of the bill of lading, both parties shall act in accordance with the contract previously concluded. However, if no prior agreement exists and the shipper raises no objection when accepting the bill of lading, the bill of lading is then regarded as the contract itself. Although due to the characteristics of marine transport, the shipper does not sign the bill of lading, since a bill of lading is after all different from an ordinary contract, the terms of the bill of lading are binding on all holders, whether or not they have signed it.
3. Negotiability of the Bill of Lading
As a document of title, a bill of lading can be transferred provided certain conditions are met. There are two methods of transfer: endorsement in blank and endorsement to a named person. However, the negotiability of a bill of lading is less than that of a bill of exchange. This is mainly reflected in the fact that the transferee of a bill of lading does not enjoy rights superior to those of the prior endorser, unlike the holder in due course of a bill of exchange. Specifically, if a person obtains a negotiable bill of lading by fraudulent means and endorses it to a bona fide transferee who has paid value, that transferee cannot thereby acquire title to the goods and cannot assert such title against the true owner. In contrast, if this situation occurs in the circulation of a bill of exchange, the rights of the bona fide transferee of the bill of exchange will still be protected, and he remains entitled to all rights under the bill of exchange. In view of this distinction, some legal scholars believe that a bill of lading is only "quasi-negotiable."
4. Issuance of Bill of Lading
The persons entitled to issue a bill of lading include the carrier and its agents, the master and his agents, and the shipowner and his agents. When signing, the agent must indicate his agency status and the name and identity of the party being represented. The document serving as evidence for issuing the bill of lading is the mate's receipt, and the date of issuance of the bill of lading should be the date on which the mate issued the receipt after the goods were loaded on board.
Bills of lading are divided into originals and copies. Original bills of lading are generally issued in duplicate or triplicate to prevent loss during circulation, in which case another original can be used. Each original has the same effect, but once one of them is used to take delivery of goods, the others become void. The carrier does not sign copy bills of lading; the number of copies is determined according to the actual needs of the shipper and the shipowner. Copy bills of lading are only used for daily business and have no legal effect.
5. International Conventions Relating to Bills of Lading
Since the parties interested in a bill of lading often belong to different nationalities, and the place of issue, port of loading, and port of destination may be located in different countries, and since bills of lading are formulated by shipping companies according to their own national laws and regulations, their formats, contents, and wording are not entirely the same. Once a dispute arises or litigation is involved, questions concerning the legal effect of the bill of lading and the applicable law will emerge. Therefore, unifying the laws and regulations of various countries relating to bills of lading has always been a goal pursued by all countries. Currently, there are three international conventions that have come into force and play an important role in unifying national regulations on bills of lading or relating to international carriage of goods by sea:
(1) Hague Rules
The full name of the Hague Rules is the International Convention for the Unification of Certain Rules of Law Relating to Bill of Lading. It was signed by 26 countries in Brussels on August 25, 1924, and entered into force on June 2, 1931. The draft convention was adopted in The Hague in 1921, hence the name Hague Rules. More than 50 countries, including many in Europe and the United States, have successively joined this convention. In 1936, the U.S. government used this convention as the basis for domestic legislation and enacted the U.S. Carriage of Goods by Sea Act of 1936. The Hague Rules unified the laws relating to bills of lading in the carriage of goods by sea and played an active role in promoting the development of the shipping industry and international trade. They are the most important international convention and are still widely used today. China recognized this convention in 1981. The Hague Rules are characterized by protecting the interests of the carrier to a greater extent, with an unbalanced allocation of risks, which caused dissatisfaction among Third World countries as major cargo-owning nations. They repeatedly demanded amendments to the Hague Rules to establish a new shipping order.
(2) Visby Rules
Under the strong demand of the Third World countries, the opinion to amend the Hague Rules was accepted by shipping-developed countries such as the Nordic countries and the United Kingdom. However, they believed that haste should be avoided to prevent confusion, and advocated a compromise among various opinions, making only partial revisions and supplements to the obviously unreasonable or unclear provisions of the Hague Rules. The Visby Rules were thus produced on this basis. Therefore, the Visby Rules are also called the Hague-Visby Rules. Their full name is the Protocol to Amend the International Convention for the Unification of Certain Rules of Law Relating to Bill of Lading, or simply "The 1968 Brussels Protocol." It was adopted in Brussels on February 23, 1968, and entered into force in June 1977. At present, more than 20 countries and regions including the United Kingdom, France, Denmark, Norway, Singapore, and Sweden have joined this convention.
(3) Hamburg Rules
The Hamburg Rules are the United Nations Convention on the Carriage of Goods by Sea, 1978. It was drafted by the United Nations Commission on International Trade Law in 1976 and examined and adopted in 1978 at a plenipotentiary conference convened by the United Nations in Hamburg with the participation of 71 countries. It can be said that the Hamburg Rules were adopted after repeated struggles by the Third World countries, after many consultations among representatives of various countries, and after compromises on certain aspects. The Hamburg Rules comprehensively revised the Hague Rules. To a large extent, their content increases the carrier's responsibilities and protects the interests of the cargo owner, representing the will of developing countries in the Third World. This convention entered into force in 1992. However, because the signatory states are Egypt, Nigeria, and other non-major shipping and cargo-carrying countries, the Hamburg Rules currently do not have a significant impact on the international shipping industry.
Further reading: Preparation of Bill of Lading: Standard Methods for Filling in Ocean Bills of Lading see column filling practice; Types of Bill of Lading: Classification Description of Various Ocean Bills of Lading systematically sort out bill of lading classification; Content of Bill of Lading: Filling Requirements for Ocean Bill of Lading Columns understand the composition of front and back clauses.
Frequently Asked Questions (FAQ) on Bill of Lading Basics
Q: Why is the bill of lading said to be evidence of the contract of carriage rather than the contract of carriage itself?
A: The terms of the bill of lading are unilaterally drafted by the carrier, and the bill is issued after performance has taken place, so it is not the result of mutual agreement between both parties and therefore is not a contract in the strict economic sense. However, if the carrier and shipper did not sign a transport contract in advance, and the shipper accepted the bill of lading without objection, the bill of lading is deemed to be the contract itself.
Q: What are the three main international conventions related to bills of lading?
A: The Hague Rules (signed in 1924, effective 1931), the Visby Rules (adopted 1968, effective 1977), and the Hamburg Rules (adopted 1978, effective 1992). The allocation of carrier liability under these three conventions gradually became stricter, and China's Maritime Code has absorbed the spirit of these rules.
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Disclaimer: This article was compiled by the Bofeng Logistics team and verified as of August 2026. Bill of lading field requirements, documentation practices and applicable law may change with international conventions (e.g. UCP600) and current carrier requirements; actual documentation requirements are subject to the letter of credit, trade contract and the carrier's current terms.
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