Negotiable Bill of Lading
A negotiable bill of lading is a contract of carriage that can be transferred to a third party.
A negotiable bill of lading is one kind of bill of lading, distinguished by the fact that it is a contract of carriage that can be transferred to a third party. So a bill of lading is, in a nutshell, a legal document between the shipper and carrier, detailing the type, quantity, and destination of goods being carried.
The bill of lading serves as a receipt of shipment when the goods are delivered at the predetermined destination. Of course, there are different kinds of bills of lading, each type with unique stipulations and conditions.
Also known as an order bill of lading, the negotiable bill of lading transfers control (title) of the goods to the order of the entity named on the document.
How a Negotiable Bill of Lading Works
Negotiable Bills of Lading
This bill of landing can be transferred by one of its cosignees to a third party, when the cosignee signs or endorses the document and delivers it to the new cosignee (the third party). To transfer the negotiable bill of lading, the consignor (the person or business shipping the goods) must stamp and sign the bill and the carrier must deliver it.
A negotiable bill of lading must be written to the order of the cosignee, and it must be a clean bill of lading.
Clean Bills of Lading
This type of bill of lading is issued by a carrier declaring that goods have been received in the appropriate condition, without defects. The product carrier issues a clean bill of lading after inspecting the goods.
A Straight or Uniform Bill of Lading
A uniform bill of lading or straight bill of lading, in contrast, may not be transferred and is only deliverable to the named consignee (recipient). Like any bill of lading, the negotiable bill of lading also lists the goods being transported and serves as a contract of the terms of the shipment.