Difference Between Bill of Lading & Bill of Entry

Key Takeaways

• A Bill of Lading is linked to the shipment and is issued by the carrier.
• A Bill of Entry is an import declaration filed with customs.
• The Bill of Lading acts as a receipt and contract for the cargo, while the Bill of Entry supports customs assessment and clearance.
• Exporters, carriers and importers commonly work with the Bill of Lading; the importer or customs broker files the Bill of Entry.
• Keeping both documents accurate is important for smooth international trade and timely cargo clearance.

What Is a Bill of Lading?

A Bill of Lading (B/L) is a document issued by the carrier to the shipper acknowledging the receipt of the goods for transportation. It describes the cargo and serves as a receipt for the shipment. It also includes the terms and conditions for the transportation of the goods by the carrier. Hence, in international shipping, the Bill of Lading is a crucial document that provides the necessary details about the consignment and links the shipper, carrier and consignee.

What Information Does a Bill of Lading Contain?

A Bill of Lading typically consists of information such as:

• Name and address of the exporter or shipper
• Name and address of the importer or consignee
• Date of Shipment
• Description and type of goods
• Quantity of goods
• Weight of goods
• Value of goods (if applicable)
• Port of loading
• Port of discharge or destination
• Shipping and handling instructions

The exact format and information may vary depending on the carrier and shipment.

What Is a Bill of Entry?

A Bill of Entry (BOE) is an entry made by the importer or their customs broker with the customs authorities to make a claim for the duty drawback. It contains the relevant information about the imported goods to help the customs officials determine the duty, tax and other requirements. The document is submitted by the importer to the customs authorities to clear the goods.

What Information Does a Bill of Entry Contain?

A Bill of Entry typically consists of information such as:

• Importer's name and address
• Exporter's details
• Import Export Code (IEC)
• Customs House Agent details (where applicable)
• Description of imported goods
• Value of the consignment
• Country of origin
• Port of destination
• Applicable duties and taxes
• Relevant licence or permit details

Bill of Lading vs Bill of Entry: Comparison Table

In short, the Bill of Lading provides information on the movement of the goods, and the Bill of Entry provides information to customs on what is being imported and the applicable duties and requirements.

Who Issues the Bill of Lading and Bill of Entry?

The two documents are handled by different parties because they serve different purposes in an import transaction.

Bill of Lading: The shipping carrier, shipping line or its authorised agent issues the Bill of Lading after receiving the goods for transportation. It records key shipment details and acts as a receipt and contract of carriage.

Bill of Entry: The importer or their Customs House Agent (CHA) prepares and files the Bill of Entry electronically with Indian Customs. It declares the imported goods and provides the details required for customs assessment and clearance.

Who Handles Each Document?

In simple terms, the carrier issues the Bill of Lading for the movement of goods, while the importer or CHA files the Bill of Entry for customs clearance.

Pro Tip

Keep the cargo description, quantity, value and party details consistent across these documents and the commercial invoice to avoid unnecessary questions or delays during customs clearance.

Types of Bill of Entry

The Bill of Entry is classified into types based on the expectation of how the imported goods will be used following their arrival.

Bill of Entry for Home Consumption

This Bill is used for imported goods that are destined for use or consumption in India after the payment of any applicable duties and completion of the clearance process.

Bill of Entry for Warehousing

This Bill is used when an importer wishes to store the imported goods in a bonded warehouse rather than pay the applicable customs duty.

Bill of Entry for Ex-Bond Goods

This Bill applies to goods that have been stored in a bonded warehouse and are then cleared for consumption in India after the payment of the applicable duties.

In addition to these variations, there are other specialised types of Bills of Entry that may apply depending on the nature of the transaction.

What Are the Types of Bills of Lading?

There are different types of Bills of Lading depending on the nature of the transaction and the terms of transport.

Straight Bill of Lading

A Straight Bill of Lading is used when the goods are shipped to a particular consignee and the cargo is not subject to being negotiated in the same way as a negotiable order bill.

Order Bill of Lading

An Order Bill of Lading is a negotiable instrument that allows the bill to be transferred according to its terms. It is often related to a trade transaction where the ownership of the goods can change during transit.

Clean Bill of Lading

A Clean Bill of Lading is issued when the carrier accepts the goods without making any adverse notations about the condition of the goods or their packaging.

How Are These Documents Used in an Import Transaction?

Consider an Indian business that buys machinery from an overseas supplier. The overseas supplier delivers the machinery to the carrier, who issues a Bill of Lading to document the transport of the goods. Upon arrival of the machinery in India, the importer or customs agency will prepare the Bill of Entry. The customs officials use the Bill of Entry to declare and clear the goods for import. This sequence illustrates how the two documents relate to different stages of the same transaction:

This is why the two documents should not be regarded as equivalent or interchangeable in a trade transaction.

Bill of Lading vs Bill of Entry: An Easy Example

Imagine that you are an Indian electronics distributor, and you have just imported 500 laptops from Singapore.

The carrier will give you a Bill of Lading prepared upon receipt of the shipment, with details of the cargo, ports and parties to the bill. At the time of importing the consignment to India, you will have to submit a Bill of Entry to the customs authorities, who will use the information to determine the duty and clear the shipment.

Your consignment requires both documents - but serves two different purposes at two different stages of the logistics chain.

What Is the Role of Marine Insurance in These Shipments?

When goods are shipped internationally, they face risks such as damage, theft, fire and loss during transit. Marine insurance protects the financial value of the cargo against covered transit risks, helping businesses manage unexpected losses.

For importers and exporters, shipping documents such as the Bill of Lading and Bill of Entry help move and clear the cargo, while marine insurance protects the shipment itself. This gives businesses an added layer of financial protection throughout the transit journey.

Pro Tip

Keep your shipping documents in order and insure high-value cargo before transit. Good documentation and suitable marine cover together help reduce the financial impact of unexpected cargo losses.

Bill of Lading vs Bill of Entry: Quick Summary

Final Thoughts

The Bill of Lading and the Bill of Entry are both important documents in international trade transactions. But while the Bill of Lading is a transport document that accompanies the cargo, the Bill of Entry deals with the import aspect of the transaction. Understanding the nuances of the documents can prevent delays and errors in international trade