Utilizing "Received for Shipment Bill of Lading" in Letter of Credit (LC) Negotiation: Insights from Export-Import Data

The Bill of Lading holds significant importance in the export process, being issued post the completion of export customs formalities and upon receiving the original "Let Export Order (LEO)" copy. This document, provided by the shipping company, serves as evidence of goods' receipt and shipping. Here's an in-depth look, considering the impact of import-export data.

In a situation where the goods or services are loaded from a CFS (Container Freight Station) (dry port) located away from the seaport of loading, the multimodal transport provider/carrier is responsible for the movement of goods or services to a seaport. The goods or services are then loaded onto the vessel. However, the document of “Received for shipment Bill of Lading” can be issued by the shipping carrier as soon as they receive the goods or services from the seller/exporter and once the export customs clearance procedures are completed.  In short, the goods need not be loaded onto the vessel. The exporter or seller can even reach out to a customs office that is located at an inland destination, away from the seaport where goods or services are loaded. The exporter or the seller can complete all the necessary formalities and procedures and legalities at such a location for faster and smooth clearance of cargo. The shipping carrier can issue the document “Received for shipping Bill of Lading” as soon they receive the goods and post completing export clearance procedures.



Will the partner Bank accept “Received for Shipment Bill of Lading” under LC (Letter of Credit) negotiation? Does the bank accept the Bill of Lading that is issued before the goods or services are boarded on the vessel?

Usually, theimporter or the buyer intimates the seller or the exporter through an LC (Letter of Credit) to send the clean “Shipped on board Bill of Lading.” However in certain cases mutually agreed by parties (buyer and seller), the buyer or the importer agrees to mention in the LC (Letter of Credit) to accept the “Received for shipment Bill of Lading.” 

If the LC (Letter of Credit) mentions “Bill of Lading”, “Received for Shipment Bill of Lading” is more than enough to negotiate the buyer’s document as in this case the bank will not be able to find any discrepancy. However, if the Letter of Credit (LC) states, on producing the “On board Bill of Lading”, the goods or services must be loaded onto the vessel and post that the document of “On Board Bill of Lading” has to be collected by the exporter or seller from the shipping company. 

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