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What is a Clean Bill of Lading: All you need to know about its meaning and format

A Clean Bill of Lading is a document that indicates that the goods received in the vessel are in good condition and have no damage. Learn more about it in this detailed blog.
clean bill of lading
A Bill of lading serves as a legal contract between a shipper and a carrier, stating detailed information regarding the shipment being transported. A type of BOL, a Clean Bill of Lading, is a document between a carrier and a receiver for goods shipped overseas by ocean freight. It ensures that the received goods are in good condition with no damage or defects.

What is a Clean bill of Lading?

A Clean Bill of Lading is a legal document that states that the goods inside a particular shipment are safe and free from any sort of damage. It guarantees that the quantity of goods that were ordered and shipped is the same. A receiver can refuse to accept the delivery without a Clean Bill of lading, as the bill declares that the shipment is free from damage and the goods are in good condition inside the shipment. The Clean Bill of Lading is signed both by the carrier as well as the shipper. It guarantees that the goods received and placed on the vessel are in good condition with no apparent damage or defect1.

For instance, to export jewellery from India, the carrier initiates an inspection of the quantity in the shipment along with other details before issuing a Clean Bill of Lading. If there are any defects in the shipment, the carrier issues a Clause or Foul Bill of Lading instead of a Clean Bill of Lading.

Why is a Clean Bill of Lading needed?

A Clean Bill of Lading is required in every export process as it contains no notations of defect, damage, or loss, and is signed both by the carrier and the shipper2.

• It states that the goods in the shipment are totally damage-free.
• This bill acts as an assurance regarding the quality of goods to the importer.
• It also assures the importer that the exporter would not deceive him with worthless goods.
• A Clean Bill of Lading gives a positive indication to the buyer, regarding the usability, quantity, and quality of the goods.

Absence of a Clean Bill of lading reduces the chances of acceptance of goods by importers because it indicates that losses or damages have occurred to the goods.

What is the difference between Clean and Clause Bill of Lading?

Clean Bill of Lading

• A Clean Bill of Lading is a standard document that mentions that the outer packaging of goods is in good condition when the carrier receives it.

• A Clean Bill of Lading is a sea transport document that is accepted by the importer or banks.

Clause Bill of Lading

• A Clause Bill of Lading that states a defect of the goods or their packaging turns a Clean Bill of Lading into a Clause Bill of Lading.

• A Clause Bill of Lading, is not acceptable to the importers and the banks.

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Published on September 19, 2022.

Sources:
1. https://elibrary.law.psu.edu/cgi/viewcontent.cgi?article=1108&context=jlia
2. https://uncitral.un.org/sites/uncitral.un.org/files/media-documents/uncitral/en/acn9_wgiii_wp17_vol1-2.pdf
3. https://images.template.net/wp-content/uploads/2016/12/01133454/Straight-Bill-of-Lading-Template.jpg
4. https://www.researchgate.net/publication/337978274_On_the_issue_of_clean_bills_of_lading
5. https://efinancemanagement.com/international-financial-management/clean-bill-of-lading#:~:text=In%20terms%20of%20quality%20of,not%20in%20the%20expected%20condition.
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*Map not to scale. The map has been used for design and representational purpose only, it does not depict the geographical boundaries of the country. These do not conform to the external boundaries of India recognized by the Survey of India.

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