Original B/L, Telex Release, and Express B/L

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What is a Bill of Lading?

The Bill of Lading is the transport document commonly used for sea freight shipments. It is a legal document under which cargo is accepted for carriage on board a vessel. A Bill of Lading is both evidence of the contract of freight movement, and a document of title.

HBL and OBL are abbreviations that are currently used within the freight industry.

• Ocean Bill of Lading (OBL) – When shipping direct with a shipping line.
• House Bill of Lading (HBL) – When shipping with a freight forwarder.

These two terms are used when referring to the type of bill of lading you'll be receiving. When booking directly with a shipping line, you will receive an OBL (ocean bill of lading), whereas if you book through a freight forwarder, you will receive a HBL (house bill of lading).

The 3 common types of bill of ladings (based on cargo) are Original bill of lading, Telex release, and Express bill of lading. These three types differ on the basis of the documents needed for import/export clearance and are completely different from OBL or HBL (see image above).

Original Bill of Lading

The original Bill of Lading is produced once the cargo is confirmed on board the vessel and provided to the shipper in 3 x Originals and 3 x Copies. The shipper will usually hold the original Bill of Lading until they have received payment from the importer before they send the originals to them. The importer must surrender a duly endorsed original Bill of Lading with either the freight forwarder or shipping line to secure the release of the cargo.

'Original' means the bill of lading documents must be printed in hard copies at origin, and once signed and stamped, the originals must be sent in the mail (via a courier) to the final destination. Once at final destination, the consignment will only be released if original copies of the bill of lading are present. Original bill of ladings are most commonly used when shippers are under a letter of credit or the consignee is on payment terms with the shipper.

Telex Release

The original Bill of Lading is produced once the cargo is confirmed on board the vessel and provided to the shipper in 3 x Originals and 3 x Copies. Compared to Original bill of lading, Telex release differ as the shipper does not need to send original documents to destination. The shipper will usually hold the original Bill of Lading until they have received payment from the importer.

Once payment has been received the shipper will surrender the original Bills of Lading to the office of the freight forwarder or shipping line that issued it rather than forward it on to the importer.

The origin freight forwarder or shipping line will then electronically message their destination office to inform them that the Original Bill of Lading has been surrendered and to authorise release of the goods to the importer without them having to surrender a duly endorsed original Bill of Lading. In other words, the origin office will send a telex notification to destination, saying the goods can be released. If there are any charges outstanding to the origin, the cargo will not be released until its paid.

Telex Release is the most common type of bill of lading for sea freight shipping.

Seaway / Express Bill of Lading

The Seaway or Express Bill of Lading is produced once the cargo is confirmed on board the vessel. This means no Original Bill of Lading is required and goods are automatically authorised for release at destination. This is a common form of documents when the importer is on account terms with the supplier and origin freight forwarder or shipping line.

With Express bill of lading, no original documents are printed, and cargo is automatically released at destination. Express bill of lading are usually used when the consignee is on account terms and doesn't require payment of goods to be paid before receiving the goods at destination.

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When goods are transported by ship, an ocean bill of lading is issued. Ocean freight to or from the U.S. is regulated by the Federal Maritime Commission (FMC). Common types of ocean bills of lading or releases are:

* A straight bill of lading

This is a non-negotiable form of the B/L which is addressed / consigned directly to the buyer, with the buyer’s customs broker listed as a “Notify Party.” In this case, the carrier will issue a set of three original Bills of Lading, one of which must be endorsed by the consignee and presented in order to obtain the cargo at destination. Typically the straight bill of lading is issued if buyer still owes payment for all or part of the goods.

* An “order” bill of lading

This is a negotiable form which is addressed “to order” or “to order of [a party]” instead of being consigned to the buyer. The carrier will hand over the shipment to whoever presents this bill of lading, as long as it is endorsed on the back. The holder of the order bill of lading is assumed to be the owner of the goods being shipped. The order bill of lading is commonly used when the purchase of goods is covered by a letter of credit or if the goods are expected to be traded on a mercantile exchange while the shipment is still in transit.

* The electronic “telex” release

An electronic “telex” release eliminates the need for an original bill of lading to be presented at the destination for the release of the goods. Instead, the shipper endorses an original bill of lading and submits it to the carrier’s agent at the origin. The origin agent then notifies the agent at the destination in a simple message that the goods may be released without the hard copy bill of lading present. In the past, this notification was done by telex (hence the name), but today electronic releases are done by email or via integrated system notes in carrier booking systems. This is often used when a buyer still owes for all or part of the goods, but then pays before cargo arrives.

* An express bill of lading

With this type of bill of lading, the carrier agrees to only release the goods to the named consignee or notify party. It is a non-negotiable document, and no original bills of lading are issued at all. The express bill of lading is frequently used if the importer paid for the goods before shipping or has credit with the supplier. It expedites the release of the goods upon arrival and saves on time and mail courier fees by eliminating the need for a physical bill of lading to be presented.