Bill of Lading Commercial and Legal Functions of Bills of Lading

‘A bill of lading is a document signed by the shipowner, or by the master or other agent of the shipowner, which states that certain specified goods have been shipped in a particular ship, and which purports to set out the terms on which the goods have been delivered to and received by the ship… A bill of lading issued by the shipowner’s agent in the absence of any contract of carriage is a nullity. The effect of a bill of lading depends on the circumstances of the particular case, of which the most important is the position of the shipper and of the holder.
Halsbury’s Laws of England, at para 1532.

BIMCO Electronic Bills of Lading Clause

(a) At the Charterers’ option, bills of lading, waybills and delivery orders referred to in this Charter Party shall be issued, signed and transmitted in electronic form with the same effect as their paper equivalent.

(b) For the purpose of Sub-clause (a) the Owners shall subscribe to and use Electronic (Paperless) Trading Systems as directed by the Charterers, provided such systems are approved by the International Group of P&I Clubs. Any fees incurred in subscribing to or for using such systems shall be for the Charterers’ account.

(c) The Charterers agree to hold the Owners harmless in respect of any additional liability arising from the use of the systems referred to in Sub-clause (b), to the extent that such liability does not arise from Owners’ negligence.

Source: BIMCO

This clause addresses existing problem that restrict usage of electronic bills of lading as a consequence of English law requirements to issue paper documents. Statutory, by way the Carriage of Goods by Sea Act 1992 (COSGA 1992) the law deals with paper documents only. Moreover the common law requires master to deliver the cargo only against signed bill of lading.

Clause proposes to circumvent these difficulties by exercising an option available to the charterers to issue electronic bill of lading. The clause anticipates that both the charterers and the owners shall be subscribed to electronic trading system such as Bolero or essDOCS.

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