Global trade relies on efficient and effective communication across complex supply chains. One document plays a central role in this – the bill of lading (B/L). To date, it has remained stubbornly paper-based for a range of reasons, many of them highlighted by a survey of stakeholders including bankers, freight forwarders, carriers and shippers. However, many obstacles to an electronic B/L can be overcome by the widespread adoption of standards, smoothing the way for fast and effective information exchange in global trade. 

What is an electronic bill of lading? 

The bill of lading serves as document of title, contract of carriage and receipt for goods. Millions are issued every year yet only a fraction are electronic. 

Exchanging paper is time-consuming, expensive and not environmentally sustainable. It can also cause bottlenecks in supply chains because if a required document isn’t in place, or processed in time, cargo can get held up in ports. 

An electronic bill of lading (eBL) will help alleviate these issues. Information shared electronically can be exchanged more rapidly, reducing costs, improving environmental credentials and averting paperwork hold-ups. When based on standards, eBLs enable the seamless exchange of digital B/L information across disparate technology platforms.   

Survey shows the opportunity for an electronic bill of lading

For these and many more reasons, the Future International Trade (FIT) Alliance, comprising five organizations – BIMCO, DCSA, FIATA, ICC and SWIFT— was founded to facilitate and advocate for the digitalization of international trade. It set out to gauge awareness of eBL among member organisations, the extent to which eBLs are already being used and what might be hindering their adoption. 

The FIT Alliance surveyed bankers, freight forwarders, carriers, shippers, agents and consignees across 66 countries. It found that a huge majority – 94% – had heard at least a little about eBLs, but that only 5% had made a full transition to them. More than a quarter (28%) did use them in conjunction with paper, and over half (58%) of those who used only paper had plans to use eBLs in the future. 

It is important for the shipping industry that supply chain participants close the gap between intended and actual eBL use. The advantages of digitalisation are clear, as recognised by the survey’s respondents. A convincing 86% identified that increased speed could be achieved through eBLs and wider trade digitalisation. Meanwhile, over three-quarters (78%) identified process efficiencies, 73% improved customer experience, and the same percentage, cost savings. 

DCSA’s member carriers recently committed to a fully standardised eBL by 2030, with the goal of 50% adoption in 2027. This is a significant step towards digitalisation in container shipping and one that will contribute to simpler, more sustainable and resilient global trade processes. 

Why hasn’t the eBL already been adopted? 

Survey analysis revealed three key factors that have hindered eBL adoption to date. The first centres on technology, platform or interoperability concerns, cited by 73% of respondents. 

This is unsurprising because existing eBL platforms are not interoperable. Interoperability standards support platform choice because a non-standards-based eBL cannot flow from one platform to another.  

A second hurdle identified by the survey was insufficient eBL adoption by other stakeholders. Again, this was to be expected as container shipping comprises complex supply chains with many stakeholders, but standards can help stakeholders across these supply chains switch away from paper in favour of digital information exchange.  

The third most cited reason for not using eBLs was legal gaps. Over half (55%) of respondents selected this. Fortunately, legal barriers are now starting to break down. The United Nations Commission on International Trade Law (UNCITRAL) Model Law on Electronic Transferable Records (MLETR) offers a legal framework for countries that adopt it and the UK government is reviewing their bill to legalise digital trade documentation. eBL solution providers have also put in place legal frameworks to address the need.

The future of eBL

Standards-based, fully interoperable, universal eBL is a significant step towards paperless global trade in shipping. It will help unlock the potential that digitalisation offers, improving resilience, sustainability and reducing the time and cost associated with exchanging paper. 

A range of challenges that have hampered widespread eBL adoption to date can be overcome with the help of standards that support platform interoperability and enable seamless information exchange. Ocean carriers’ commitment to standards-based eBL adoption is a significant step forward in the drive towards digitalisation. 

However, all stakeholders are urged to become advocates for change in the industry. There are many steps that can be taken to facilitate eBL standards development and encourage adoption within an organisation such as: 

• discussing what needs to be done to receive eBLs with departments such as IT and finance;
• creating awareness of eBL within the wider organisation and among trading partners;
• starting conversations about available eBL solutions with carriers and/or freight forwarders; 
• joining DCSA working groups to provide input on eBL standards development.

With the promise of universal eBL at our doorstep, every stakeholder can take action to the benefit of their organisation and all of global trade. 

The post Survey Reveals Opportunities for Shipping’s Electronic Bill of Lading appeared first on Global Trade Magazine.