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House bill of lading: All you need to know about its format and benefits

A house bill of lading is issued by a freight forwarder or NVOCC (Non-Vessel Operating Common Carrier) to acknowledge the receipt of export goods for shipment. In this blog, learn about format and examples of House BOL.

There are various stages in the shipment of cargo (export goods) – from loading to delivering it to the end customer or importer. Among the types of bill of lading, a house bill of lading acts as a legal document to prove the ownership of goods that is being shipped. It is a key document in the ocean freight process.

What is a house bill of lading?

A House Bill of Lading is a type of Bill of Lading, created by an Ocean Transport Intermediary (OTI) such as a Non-Vessel Operating Common Carrier (NVOCC) or a freight forwarder and given to the supplier post receiving the cargo. An HBL states the contract between supplier and carrier company. It is the duty of the supplier and the carrier company to solve any sort of issues that might occur during shipment. The supplier then delivers the shipment to the freight forwarder, who, after inspecting the cargo, delivers it to the consignee at the mentioned destination¹.

What is the purpose of a house bill of lading?

A house bill of lading is legal proof of a contract between the consignee and the carrier company. It acts as a legal slip or acknowledgment that the carrier has received the consignment for shipment. It is also an assurance that the consignment is damage-free and ready to be shipped to the consignee. If any damage of any kind is caused to the consignment during shipping, then the carrier company is held responsible for this damage.

What is included in a house bill of lading?

Some of the information mentioned in a house bill of lading are:
• Exporter’s name and address
• Importer’s name and address
• Information about shipped goods
• Total value of goods that has been shipped in monetary terms
• Details about mode of transportation that are being used for shipment
• A detailed study of shipment terms and conditions

Format of a house bill of lading

Following is the format of the house bill of lading:

• A House Bill of Lading format is almost the same as the freight forwarders’ bill of lading format.
• There is no legal signing authority as to who should sign an HBL, but in most cases, an HBL is issued as well as signed by a freight forwarder. It can be signed by any member of the carrier company.
• The freight forwarder signs a house bill of lading, representing the terms and conditions as per their perspective, so that no dispute from any parties takes place during the shipping of goods.

How does a house bill of lading work?

Step 1: Shipment of goods from one city to another

The exporter first gets in touch with a freight forwarder for shipment of goods, who then surrenders the goods to a shipping agent. The shipping agent then issues a master bill of lading, which is submitted to the freight forwarder. Goods can now be shipped to the destination city.

Step 2: Collection of goods by freight forwarder

The freight forwarder from the source city issues a house bill of lading to the exporter, who then sends the House BOL to the importer. Also, the freight forwarder sends the master bill of lading to the freight forwarder of the destination city, and the latter can collect the goods.

Step 3: Distribution of goods to the importer

Now, the freight forwarder of the destination city has the master bill of lading and hence, will be able to clear the goods at the port. The importer will have to surrender the house BOL to the freight forwarder so that he can unpack and distribute the goods to the importer.

Common terms and conditions in a house bill of lading

Below are some of the common terms and conditions when a house bill of lading is issued²:

● The terms and conditions provide details about the carrier's tariff. The bill contains applicable provisions, if any. The carrier is another source for these clauses. If there is a discrepancy between the appropriate tariff and the house bill, the tariff should take the house bill into account.
● The house bill usually cannot be modified. The holding or receiving authority must follow the terms mentioned.
● The bill serves as the bare minimum proof that the carrier is lawfully transporting goods, but proper substantiating paperwork must be supplied. If it is stated in the bill that the third-party carrier is working in good faith, there is no need for additional documentation.
● The carrier should be free to subcontract for a portion or the entire journey. The carrier's business keeps the carrier out of any issues that arise. The carrier is not held responsible for any disputes.
● Both the cargo and the transporter must adhere to the laws of the seas they travel through, however, the rules may vary between nations, so travellers should be aware of this before departing.
● The only task of the carrier is port to port. In other transit scenarios, the carrier is not responsible for the cargo.
● The merchant's responsibilities throughout the journey are specified in the house bill of lading. Additionally, it specifies the maximum quantity of cargo that may be loaded into the containers.
● In the terms and conditions of the bill, there is also a provision for temperature-controlled cargo and adequate inspection.
● The house bill also includes live animals and provisions for deck cargo and cargo descriptions.
● According to the terms and circumstances, different fees are assessed for the transportation, possession of the items, and lien.
● There cannot be any waivers for the house bill unless any clauses are added. For the cruise, applicable legislation is specified.
● The parties must abide by the exchange of the necessary data and consent to the handling of personal information as specified in the bill.

Difference between house bill of lading and master bill of lading

House bill of lading

• It is issued by the freight forwarder or the Non-Vessel Operating Company (NVOCC).
• It acts as a receipt for shipment from an exporter.
• It represents the contract between the shipper and the consignee.

Master bill of lading

• It is issued by the ship owner, carrier, or operator.
• It acts as a receipt that can potentially cover the shipments of many exporters.
• It represents the transfer of cargo from the forwarder to the carrier.

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More blogs on bills of lading

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2. What is a multimodal bill of lading?

3. What is an order bill of lading?

4. What is a claused bill of lading: All you need to know about its meaning and format

5. What is a through bill of lading?

6. Bill of lading: All you need to know about its format and benefits

7. Ocean bill of lading: All you need to know about its types and format

8. What is a clean bill of lading: All you need to know about its meaning and format

9. Master bill of lading vs house bill of lading: Everything you need to know

10. Straight bill of lading: Guide to its meaning and format

11. What is a switch bill of lading: Guide to its meaning and uses

12. What is an inland bill of lading?

Frequently Asked Questions

What is the main difference between a Bill of Lading and a House Bill of Lading?

A Bill of Lading is a legal document that works as proof of shipment when the cargo is shipped overseas. It acts as a contract of carriage, which outlines the shipping details. On the other hand, a House Bill of Lading is issued by the freight forwarder or NVOCC, which contains details of the cargo, carrier and so on.

Who issues the House Bill of Lading?

Although anybody can issue an HBL, it is usually issued by the carrier companies. The terms and conditions of the contract of carriage must be suitable and accepted by all the parties involved. Also, those who issue their own HBL must take all necessary precautions including a suitable insurance that covers fraud or risk of any kind.

Visit Exports Compliance Dashboard to view and meet your document requirements

Can anyone issue a house Bill of Lading?

As of now, there are no restrictions relating to the issuance of HBL. But in countries like USA or India, it requires a Bill of Lading (normal or house) that must be registered with the relevant official authorities, before it can be used further during the shipment process. During the shipment, the carrier has the legal authority of the consignment through HBL. When the consignment reached its destination, the recipient must provide the correct required documentation that will help him to pick up the consignment.

Published on September 10, 2022.

Sources:
1. https://www.indiacode.nic.in/bitstream/123456789/2278/1/a1856____9.pdf
2. https://www.seashiplogistics.com/pdf/legislations-BOL.pdf
3. https://www.tbgfs.com/wp-content/uploads/2013/01/Bill-of-Lading-Blank-Sample.pdf

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