Bills of lading: The choice is yours

Shipping via motor carrier? There are several bills of lading you could use. Here's a rundown of some of the options and how they differ.

By Ray Bohman -- Logistics Management, 3/1/2000

A question that is commonly raised by novice and experienced shippers alike concerns bills of lading: Is there a single, standard bill of lading that must be used when shipping via for-hire motor carriers, or are different options available?

Shippers are always relieved to learn that there is no single format they are required to use and that in fact, they have several choices. Which form they choose depends on which industry their company is in, who the consignee is, which carrier they do business with, how much detail they wish to spell out on the document itself, and similar considerations.

In the following paragraphs, we'll review some of the most common bill-of-lading (B/L) formats shippers are using today. They include:

- The Uniform Straight Bill of Lading. This is the granddaddy of all bill-of-lading formats, having been lifted from the railroads back in the mid-1930s. Sometimes referred to as the "long form" because it is usually printed on 81/2- by 11-inch paper, it is not widely used any more even though it is one of only two pro forma bills of lading published in the National Motor Freight Classification (NMFC). The reason it has fallen out of favor is its requirement that the "Terms and Conditions" be printed in full on the back, which adds to the printing costs.

- The Straight Bill of Lading--Short Form. The short form is more popular today because it has no requirement that the "Terms and Conditions" be printed on the reverse side. The back of the short form is left blank, but the shipper agrees to the implied "Terms and Conditions" by imprinting the following sentence at the end of the second paragraph near the top of the B/L:

"The shipper hereby certifies that he is familiar with all the terms and conditions of the said bill of lading, including those on the back thereof, and the said terms and conditions are hereby agreed to by the shipper and accepted for himself and his assigns."

By the way, even though this format is called the Short Form and some shippers reduce it in size, the pro forma copy published in the NMFC is just as long as the Uniform Straight Bill of Lading--namely 81/2 by 11 inches. The choice of paper length is yours.

- Shipper-Provided Short Form Bills of Lading--Not Negotiable. In the NMFC's Item 360 ("Bills of Lading, Freight Bills and Statements of Charges"), Section 1(h) gives consignors the authority to furnish their own bills of lading. In effect, it allows shippers to customize their own bills of lading--a provision that many, many shippers take advantage of.

Note 2 in that section states: "Consignor-provided short form bills of lading need not be in any particular format so long as the information requirements of Sections 1 and 2 are observed and the bill of lading is complete when tendered by the shipper to the carrier for signature."

Such bills of lading may be generated by a computer on plain paper, but each must bear the title "Shipper-Provided Short Form Bill of Lading--Not Negotiable." Our experience has been that many shippers use this title on preprinted forms as well.

Note 2 also requires the shipper to incorporate the terms and conditions of the bill of lading by means of the following statement:

"All parties thereto and their assigns are familiar with, and agree that this bill of lading is subject to: (1) the terms and conditions of the Uniform Straight Bill of Lading as set forth in the National Motor Freight Classification, and (2) the individually determined rates and contracts agreed upon in writing between the carrier and shipper, if applicable, otherwise the rates, classifications and rules that have been established by the carrier and are available to the shipper, on request, which are in effect on the date of the shipment."

The rule also sets forth the order in which the following information must appear on shipper-provided bills of lading:

--Carrier's name and address;

--Carrier's Pro number;

--Shipper's bill-of-lading number;

--Consignee's reference/purchase-order number;

--Consignee's destination and address;

--Shipper's origin and address;

--Statement of conditions or restrictions placed on the shipment (where appropriate), including released-valuation information, number of pieces and kinds of packages, commodity description, weight, and hazardous-material designation as required, including the furnishing of placards to the carrier;

--C.O.D. (where appropriate), including the amount to be collected and the party to pay the C.O.D.; and

--Freight terms (collect or prepaid).

The document must be concluded with a date and the notation: "Received in apparent good order--exceptions noted."

The NMFC further states that when the above information and notations are included in the shipper-provided bill of lading, it constitutes acceptance of all of the terms and conditions provided in the Uniform Straight Bill of Lading.

- Individual Carriers' Bills of Lading. Many for-hire carriers, particularly larger less-than-truckload (LTL) carriers, have drafted their own bill-of-lading formats, even though they also are party to the two bill-of-lading formats found in the National Motor Freight Classification. One example is Roadway Express, which has a number of its own bill-of-lading formats. Roadway will make these forms available to shippers, usually in very small quantities. They come in particularly handy for services that are not frequently used, such as trade-show delivery.

The specialized bill-of-lading formats Roadway Express makes available to its customers include a Straight Bill of Lading (for electronic transmission), a Multiple Shipment Bill of Lading, a Trade Show Bill of Lading, and separate "E-Z Export" forms for shipments to Canada, Mexico, and other international destinations.

- The TCPC Shipper's Domestic Truck Bill of Lading--Not Negotiable.

The Transportation Consumer Protection Council (TCPC) developed this bill of lading for use by its members. Individual shippers can use this form when designing their own bill of lading for use with common carriers for a series of shipments under a contract or for individual shipments. This version has no terms and conditions on the back but incorporates by reference the terms and conditions in a "Common Carrier Rate Agreement" that must be executed by the shipper and carrier.

Shippers planning to use this bill of lading, for which the TCPC charges a nominal fee, should request a carrier's agreement in writing to use this bill-of-lading form or negotiate it into any of their contracts with carriers. For more information, contact the TCPC, 120 Main Street, Huntington, NY 11743. Phone: (631) 549-8984; Fax: (631) 549-8962; or see "Available Publications" on TCPC's Web site (www.tcpcinc.com).

- VICS Standard Bill of Lading. The newest bill of lading on the scene, the VICS (Voluntary Interindustry Commerce Standard) form, was developed by several large manufacturers and retailers that use electronic data interchange (EDI) on a regular basis. It expands the bill of lading's traditional function--that of serving as a contract of carriage and a receipt for the goods--to include providing the shipper, carrier, and/or consignee (customer) with all of the essential information they need for processing goods through the retail supply chain.

If your company is a vendor to such major retailers as Wal-Mart, Target, Federated Stores, or Dayton Hudson, you may need to use this bill-of-lading form in the future. For more information, see "A new bill of lading hits the scene" on Page 35 of the August issue of Logistics Management, or visit the VICS Web site (www.vics.org).

Get It in Writing!

With so many options available, shippers may wonder whether they may still use the old bill-of-lading formats that were published in the NMFC prior to December 1997. Some shippers are still using them, and we have yet to hear of an instance in which a carrier has refused to accept such bills of lading.

Shippers should be aware, however, that carriers that are parties to the National Motor Freight Classification--more than 1,600 in all--believe that the terms and conditions of the revised Uniform Straight Bill of Lading contained in the current issue (100-Z) of the NMFC take precedence over any shipper-provided B/L they may accept. They are hanging their hat on Item 362 of the NMFC, titled "Application of Bills of Lading." That rule reads:

"Unless the shipper and carrier have an effective prior written agreement to use another bill of lading, all motor carriage performed by carriers participating in this tariff shall be subject to the bill-of-lading terms and conditions of the Uniform Straight Bill of Lading shown in NMFC 100-X and successive issues."

Clearly, shippers that want to use their own bills of lading or any of the other B/Ls described in this article must make sure that a document is acceptable to carriers and appropriate for the movement before they actually use it in commerce. Our best advice: If in doubt, clear it with your carriers, and get their acceptance of your bill of lading in writing.

Ray Bohman, a well-known consultant and author, is editor of several highly successful newsletters on transportation and is a consultant to a number of national trade associations.

How to Avoid Copyright Violations

If you are planning to print bills of lading that use either of the two formats published in the National Motor Freight Classification--or if you simply wish to lift some of the major provisions contained therein--you will have to take steps to avoid violating the copyright, which is held by the American Trucking Associations (ATA).

To comply with copyright law, you must fill out and send in a "license agreement" to the ATA. The license agreement costs you nothing and takes about two minutes to fill out. To secure a copy of the agreement form, contact Paul G. Levine, Membership and Publications Manager, National Motor Freight Traffic Association, 2200 Mill Road, Alexandria, VA 22314-4654. Telephone: (703) 838-1810; fax: (703) 683-1094; e-mail: nmftz@erols.com.