First Know This....
Bill of Lading is the document of title i.e Ownership of Goods. We all know that BL playes an important role in the business of Import or Export. Original Bill of Lading would be provided to the exporter by shipping company when he safely loads the goods into the vessel, that original Bill of Lading must be available in the hands of an importer in order to clear the goods at his port.
Now there is always tussle between Exporter and Importer; Exporter wants payment first then he wants to release BL and buyer wants BL first then he will release the payment.
So when there is a lack of trust buyer and seller prefers banking terms like LC. Where Buyer needs to freeze his funds into his bank, the exporter has to submit the BL to his bank and gets his funds released.
But there are many scenarios arising in the international trade where documents are there in the bank, buyer gets the goods at port and buyers bank unfreeze the funds and at the end of the day exporters don't get anything.
Actually people don't know & do not understand the Difference between Negotiable BL and Non-Negotiable BL
Non-Negotiable BL
Non-Negotiable BL means this BL could not be used as the negotiations especially regarding the payment. If the buyer has BL Scan Copy, Photocopy, BL Number then he may get the goods and shipping line should not be made liable for it. In this shipping, the line will never get it verified from the bank nor ask anything regarding payment, they may release the goods to the buyer in spite of his non-payment of funds.
Ex. Morbi Ceramic Exporters lost millions of dollars by sending 100s of Containers to Brazil before few months.
Negotiable BL
In Negotiable BL the buyer has to pay the money at first and then he can get the BL in his favour; endorsement from bank , the shipping line has to verify that endorsement and then can release the goods, else they would be liable for the payment.
BL is always NON Negotiable unless and until its consigned "To Order of Bank"
So if you want to make the BL Negotiable you have to get it marked "To Order of Bank" in Consignee & Buyer can get in his name once he pays full money because even in LC its not Advance payment, its Letter of Credit.
Updates in IATA [International Air Transport Association] tact manual tact manual......
Can AWB: Airway Bill Negotiable?
Ans : No AWB can never be Negotiable , only BL can be... AWB is always NON Negotiable
So there is huge risk when you send the goods via Air, so never share AWB Number or Scan Docs before payment arrival. As your buyer to collect AWB or BL to collect it from the bank itself.