DEFINITION of Negotiable Bill Of Lading
A negotiable bill of lading is a contract of carriage that can be transferred to a third party.
BREAKING DOWN Negotiable Bill Of Lading
Bill of Lading: The Basics
So, very quickly, a bill of lading is 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. And there are different kinds of bills of lading, each type with unique stipulations and conditions.
Negotiable Bill of Lading: The Specifics
A negotiable bill of lading can be transferred by one of its cosignees to a third-party, when the cosignee signs, or endoses 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 clean bill of lading.
A clean bill of lading is a bill of lading 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, in contrast, may not by 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.
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.