Question

What is the difference between straight and shipper's order of lading?

Answer 1

Lading is the process of loading cargo onto a ship or vessel, and a negotiable bill of lading is one kind of bill of lading. The bill of lading is a legal document between the shipper and carrier, detailing the type, quantity, and destination of goods being carried. The negotiable bill of lading is distinguished by the fact that it is a contract of carriage that can be transferred to a third party.

1]   Straight bill of lading meaning :a bill of lading that is issued to a specified consignee for the delivery of the goods and that cannot be endorsed to another party.

Order bill of lading meaning :a bill of lading that is issued to the order of a shipper or consignee for delivery of the goods and that can be transferred by endorsement to third parties.

2]   When used :

• A straight bill of lading is used when payment has been made in advance of shipment and requires a carrier to deliver the merchandise to the appropriate party.
• An order bill of lading is used when shipping merchandise prior to payment, requiring a carrier to deliver the merchandise to the importer, and at the endorsement of the exporter the carrier may transfer title to the importer. Endorsed order bills of lading can be traded as a security or serve as collateral against debt obligations.^[19