The Complete Guides to eBL.
What is an Electronic Bill of Lading (eBL)?
An electronic bill of lading (eBL) is a digital version of a paper bill of lading that is used in international trade transactions. The eBL is created, processed and transmitted electronically, using digital signatures and encryption technology to ensure the authenticity and security of the information contained within. Like a paper bill of lading, an eBL serves as evidence of the contract of carriage, receipt of goods, and ownership of the goods being transported. However, unlike a paper bill of lading, an eBL offers several advantages in terms of speed, efficiency, security, and cost-effectiveness. Where a paper bill of lading often will not arrive at the discharge port before the ship arrives, an eBL will arrive almost instantaneously.
Key Benefits
Safer
Through the use of secure and reliable technologies, eBLs offer a safer alternative to paper bills by ensuring authenticity and security. Unlike their counterparts, which are vulnerable to theft and fraud, eBLs benefit from advanced security measures. This protection creates a much higher barrier to criminal activity, which can avoid potential financial losses and legal disputes. eBLs provide a secure and dependable alternative means of managing international grade transactions, lowering fraud risk and enhancing trust among tracing partners.
Faster
By eliminating the need to physically transport and handle documents, eBLs are faster than paper bills. With eBLs it's much easier to track shipments and prevent delays and errors commonly associated with paper-based documentation. eBLs also enhance communication and collaboration between parties involved in the transaction. They provide a more efficient streamlined approach to international trade documentation, benefiting users with substantial time and cost savings.
Greener
eBLs provide a greener alternative to paper bills by eliminating the need for physical transportation, handling and storage of documents, effectively reducing greenhouse gas emissions, energy consumption and paper waste. By adopting eBLs, business can enhance sustainable practices in their operations, benefiting themselves and the environment.
The current state of eBL Adoption
A survey by the FIT Alliance among supply chain stakeholders shows that awareness of eBLs is high with 94% of respondents having heard about eBLs. A closer look at the numbers reveals that 28% of respondents already use eBLs in conjunction with paper. A majority (58%) of those using only paper B/Ls report their organisations have plans to use eBLs in the future.
The use of eBLs varies significantly between trade sectors. It is fair to say that the use in some sectors remains fairly low, but it is increasing. In March 2023 BIMCO launched a rolling campaign aiming for 25% eBL adoption by 2025 in bulk shipping. For certain commodities, some companies are already achieving as much as 60% of the volume on eBLs. On the container side, the members of DCSA (MSC, Maersk, CMA CGM, Hapag-Lloyd, ONE, Evergreen, HMM, Yang Ming and ZIM) have committed to reaching 50% adoption by 2027 and 100% adoption by 2030. Meanwhile, 27 countries have implemented the FIATA eFBL standard with more than 600 electronic FIATA Bills of Lading (eFBLs) now being used around the world.
What is interoperability?
Most of the eBL systems operate within a “walled garden” with their own proprietary technology and terms and conditions that govern the relationships between the stakeholders involved in a transaction.
What this means in practice is that parties that want to exchange an eBL must all subscribe to the same platform. It is not currently possible to exchange an eBL between different platforms due to a lack of technical and legal interoperability. FIT Alliance members BIMCO, DCSA and FIATA have produced open electronic bill of lading data standards which are a stepping stone towards technical interoperability between the different platforms. DCSA and Swift have also completed Proof of Concepts which have successfully demonstrated technical interoperability.
Signing up to use multiple platforms requires significant time and resources: getting the legal department to read through and approve the platform’s rulebook and training personnel to use the new platform. For some parties, for example a big shipper, this might not be an issue as they will simply tell their counterparts to use whatever system they have subscribed to. But for a bank, it may require a lot of additional resources if their clients want to use different platforms. For cargoes that are traded while the ship is enroute, it can also be challenging to get everyone involved onboarded to the same platform.
There is little doubt that interoperability would make the adoption of eBLs appeal more broadly. It is key to both eliminating the need to sign up to multiple platforms.