Open Bill of Lading (B/L) shows no consignee at all; such would be a most unsatisfactory document as it would be like a blank cheque.
Order Bill of Lading (B/L) is very common indeed because of its value in letter of credit transactions. Order Bill of Lading (B/L) can best be compared with a cheque drawn to cash and once it is endorsed by the shipper it becomes in effect a bearer document. This sounds a very dangerous procedure as, theoretically, if someone dropped it in the street, the person picking it up could claim the cargo; in fact the system works very well. Banks in a letter of credit transaction do not want to assume the liabilities and responsibilities of a consignee but simply want to hold the original Bill of Lading (B/L)‘s as security. Therefore, instead of the bank being named as the consignee and then endorsing it over to the actual importer, the bank insists on the section of the Bill of Lading (B/L) marked Consignee having just the words To Order written in, and the shipper’s endorsement on the back. When all is in order the Bill of Lading (B/L) is handed to the importer who can claim the cargo from the carrier. Most Order Bill of Lading (B/L)‘s have a space for a Notify Party to be inserted. Notify Party is usually the actual importer and putting his name there ensures that he knows when to contact the bank. Incidentally, there is no actual legal obligation on a line to pass information to the notify party.
Liner Bill of Lading (B/L) is still only evidence of a contract it carries far more detail than a Charterparty Bill of Lading (B/L) because the reverse of a Liner Bill of Lading (B/L) contains the full text of the contract of carriage. With a Charterparty Bill of Lading (B/L) such masses of wording are not necessary as the contract is the charterparty itself and it is only, therefore, necessary to devote a sentence or two to incorporate it (and the arbitration clause) and back of a typical Liner Bill of Lading (B/L). Liner Bill of Lading (B/L) example:
- Conline Bill of Lading (B/L) by BIMCO (Baltic and International Maritime Council)