What is Bill of Lading (B/L)?

A bill of lading (B/L) is issued by the carrier or its agent and serves three functions: a receipt for the goods, evidence of the contract of carriage, and a document of title. A negotiable ("to order") B/L can be endorsed to transfer ownership of the cargo, which is why it underpins letter-of-credit transactions. Variants include the master B/L (carrier to forwarder) and house B/L (forwarder to shipper).