Usually when you receive a Chinese bill of lading it will look pretty familiar, it is prepared in English and you will likely be familiar with the name of the carrier.
If you don't recognize the carrier's name you need to understand if the document is a "Master" or a "House" bill of lading.
This article explains the circumstances in which the Chinese bill of lading you receive might be a "House" bill of lading, and what precautions you should take.
Further, we present some of the most popular "Master" Chinese bill of lading - those issued by the largest shipping companies operating in China.
What is a Chinese Bill of Lading?
A Chinese bill of lading, as anywhere else in the world, is a legal contract between a shipping company "the carrier" and whoever is sending the goods, "the shipper".
As far as we are aware, a Chinese bill of lading is always an English language document, although some fields of the form may also include details in Chinese characters.
For a more in-depth introduction take a look at this article.
What do "House" and "Master" mean?
In most cases a Chinese bill of lading is a "Master" bill of lading, which means it has been issued directly by the shipping company that will transport your goods. The common abbreviation for a Master bill of lading is "MBL".
In some circumstances when your Chinese supplier has used a freight forwarder, you may receive a "House" bill of lading. This is a bill of lading issued by the freight forwarder, not by the company which is actually shipping the goods, and is commonly abbreviated as "HBL".
In Chinese these terms are written as follows:
- House Bill of Lading: 货代提单 (Huò Dài Tí Dān)
- Master Bill of Lading: 船东提单 (Chuán Dōng Tí Dān)
What are Freight Forwarders?
Freight forwarders (also known as NVOCC or non-vessel operating common carriers) are agents used by companies to facilitate the export of their products. They provide exporters assistance with preparing customs documentation and often partner with a range of shipping companies to help exporters get their products shipped from China's busy ports.
How does it work? Well, once cargo from the exporter has been received, the freight forwarder books the cargo with the carrier and a master bill of lading is given in return.
Depending on the circumstances, the freight forwarder may issue the shipper with either the original "Master" or their own "House" bill of lading.
How to Identify a Master Bill of Lading
The easiest way to identify a "Master" bill of lading is to simply look at the name and logo of the company that issued the document.
If a Chinese bill of lading is a "Master", it was probably issued by one of the many large shipping companies operating in China, which includes:
This is an example of a "Master" bill of lading, issued by COSCO:
Note that not all the above shipping companies are Chinese companies - most of the major international shipping companies also operate in China.
How to Identify a House Bill of Lading
If your Chinese bill of lading isn't issued by one of the shipping companies listed above, it might be issued by one we didn't include. You can see a more exhaustive list of shipping companies on container tracking website track-trace.com.
If you still can't find the document issuer, it is more than likely that the document you have been given is a "House" bill of lading.
This is an example of a "House" bill of lading, issued by Ningbo forwarder "Portever Shipping Ltd.":
To further make sure you can also lookout for these telltale signs:
- Who is the "Shipper"?
A Chinese bill of lading will include a field identifying the shipper.
If this field specifies a freight forwarder it is likely to be a "Master", if it specifies the Chinese company exporting the goods it is likely to be a "House" bill of lading.
- Different Loading Plan
For a "FCL" (Full Container Load) shipment both a House and Master bill of lading can be issued.
However, for "LCL" (Less Container Load) shipments only a "House" bill of lading is issued to the exporter.
"LCL" means that more than one customer's goods are being shipped together in one container, so although the freight forwarder receive a "Master" bill of lading from the shipping company, they only issue a "House" bill of lading to each client.
- Bill of Lading Number
Each bill of lading is issued with a unique number and for "Master" bill of lading the first few characters will usually correspond to the carrier's name.
For example, bills of lading issued by Maersk will usually start with the letters "MAEU".
Risks Associated with "House" Bill of Lading
Although shipment details should be the same on "House" and "Master" bills of lading (except for shipper and consignee), it is always a good idea to request your forwarder to provide a copy of the "Master" bill of lading, when they provide you with a "House" bill of lading.
Whilst large carriers have systems in place which allow you to track cargo, track vessels and check bills of lading, the freight forwarders which issue house bill of lading typically don't have such systems in place.
Furthermore most carriers are huge international companies that have a reputation to protect, whereas freight forwarders are often very small companies or even individuals.
When handling letters of credit, some banks may not accept a house bill of lading and insist on receipt of a master bill of lading, which they consider more dependable.
A few years ago we heard of many scams involving fake Chinese bill of lading - using both "House" and "Master" versions. This doesn't seem to so common at the moment but it is still worth considering.