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Should you ever switch bills of lading? 

It’s not illegal to switch bills of lading, but beware … it can expose you to serious risks. 

If you are the owner of goods (in other words the holder of the first bills of lading) you can make a request to switch bills. Although under English law this is not prohibited, if you do not fully consider all the possible consequences involved then it could potentially expose the carrier to a number of serious risks. Our advice, as one of the world’s leading Customs Clearing Agents, is to speak to us before you commit yourself to this complex process. We will be able to advise you on the risks involved and at the same time we can help to ensure that you do not jeopardize either your shipment of your finances. 

Just to clarify the situation, bills of lading are issued to the shipper who having received payment then transfers the bill to the consignee. By presenting the bill to the master it allows the consignee to accept delivery of the cargo at the discharge port. 

If the bill of lading is flexible it could be transferred on numerous occasions before the final purchaser of the goods takes delivery. 

In other words, bills of lading generally confirm:
•  A receipt or evidence of quantity and condition.
•  A confirmation of title to the goods.
•  A bank’s security in respect of any credit given to the buyer. 

If you do switch a bill of lading it involves a second bill being issued. This automatically supersedes the first bill. 

In reality this procedure is fairly common and in most cases it makes sound commercial sense. 

There are potential risks involved however, and the practice raises the issue as to whether the carrier can and should comply with the request. 

Switching bills of lading places uncertainty on the carrier and they can quite rightly question whether the party responsible for switching the bills of lading has either the right or the authority to do so.

Just to be aware of the pitfalls, here is a brief list of just some of the risks involved: 
•  Theft and misdelivery claims.
•  Claims of deceit and misrepresentation.
•  The prejudice and possible nullification of insurance cover.
•  The breeching of international conventions. 

In order so minimise the risks of switching bills of lading you should always consider the implications of the process.
Is it legal?  Will it affect the content of the carriage? Will it mislead a third party? Will affect your insurance? Will the switch be enforceable? 

As you can appreciate, the practice of switching bills of lading can be a minefield. Our advice is that if you do propose to switch the bills of lading then insist on the surrender of any or all previous bills. Ensure everyone involved or affected is notified and above all, check with your insurers. 

Concerned?  Confused? Have a word with Aerona (Air & Sea) Customs Clearing Agents. Our international experience and expertise will help and assist you to negotiate this difficult and potentially hazardous process.You can call us on: 0161 652 3443. You can also email us at: This email address is being protected from spambots. You need JavaScript enabled to view it., or you can send us an online message using the form that can be found on our Contact page.