Ocean freight release, simply put, is the process by which a shipping company or its agent authorizes the consignee to take possession of the goods. Essentially, it’s the crucial step in transferring ownership of the goods from the seller/carrier to the buyer. In international shipping, goods cannot be taken away at will; the release process must be completed before the consignee can pick up the container at the port, clear customs, and deliver the goods. It’s the core action of the “last mile” in foreign trade shipping.
The prerequisites for freight release are that the goods have arrived at the port, the fees have been settled, and the document of title is valid. As the carrier, the shipping company will only notify the destination port agent to release the goods after confirming receipt of freight, the legality of the release order, and the absence of deductions or disputes. Without formal release, even if the goods are at the port, the consignee cannot take possession. This is why the ocean bill of lading is called a “document of title.”
There are three most common methods of ocean freight release, each corresponding to different transaction scenarios: release with original bill of lading, release via telex release, and release via sea waybill/sea waybill.
Release with original bill of lading is the most traditional and secure method. The shipper sends the original paper bill of lading to the consignee, who then takes the original to the agent at the port of destination to exchange for the bill of lading. The shipping company releases the goods only after confirming the bill of lading’s authenticity and validity. This method keeps the seller firmly in control of the goods and is suitable for goods with outstanding payments, new customers, or high-value shipments. However, the process is slow, requires courier delivery, and can easily delay pickup.
Telegraphic release (TLS) is currently the most common method. After confirming receipt of payment, the shipper applies for a TLS with the shipping company. The shipping company sends an electronic instruction to the port of destination through its system. The consignee does not need the original bill of lading; they can exchange it for the bill of lading and pick up the goods with their identification and a copy of the TLS. The advantages are speed and no need to send the original documents. TLS is almost universally used on near-sea routes and is suitable for established customers, orders with full payment, and orders with urgent delivery times.
Sea waybill (SWD) release is even simpler. The SWD is issued directly upon shipment and is not a document of title. After the goods arrive at the port, the consignee only needs to prove their identity to pick up the goods; the bill of lading is not required throughout the entire process. The advantages are speed and zero risk of loss, but there is absolutely no control over the goods. It can only be used for payments before delivery, affiliated companies, and clients with absolute trust.
The most common problems in the release of goods are release without a bill of lading and demurrage fees. If the shipping company violates regulations by releasing the goods to the buyer without receiving the original bill of lading or telex release instructions, the seller will lose both money and goods. If the goods are delayed and the consignee does not pick them up, demurrage fees and container demurrage fees will be incurred daily, and the goods may even be auctioned by customs in the long run.
For the seller, the core principle of releasing goods is only one: never release goods without receiving payment. This applies to both FOB and CIF contracts. As long as payment is not settled, the original bill of lading must be held tightly, and there should be no telex release, no changes to the consignee, and no arbitrary issuance of delivery documents.
(Note: The above information regarding timeliness and costs is for reference only. Please refer to the actual situation at the time of shipment. Thank you!)
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