Clean B/L and Remarked B/L

Clean Bill of Lading vs Claused Bill of Lading

A Clean Bill of Lading and a Claused Bill of Lading are important classifications based on statements in the B/L concerning the apparent condition of the cargo or its packaging.

A Clean B/L refers to a B/L on which the carrier has not noted any clauses or remarks indicating visible defects or irregularities in the cargo or packaging at the time of receipt or loading.

In contrast, a Claused B/L records visible abnormalities such as damage, wetting, rust, a quantity shortage, defective packaging, or exposed contents.

A Claused B/L is also sometimes called a Dirty B/L or Foul B/L.

However, a Clean B/L does not guarantee the quality, performance, composition, internal condition, declared quantity, or conformity with contract specifications of the cargo.

Also, the issuance of a B/L with remarks does not automatically exempt the carrier from liability for all subsequent damages.

It is necessary to verify whether the remarks on the B/L correspond to the damage confirmed at the destination, whether the damage has worsened, or whether new damage not noted in the remarks has occurred.

The distinction between Clean B/L and B/L with remarks affects L/C settlement, cargo delivery, cargo insurance, carrier liability, surveys, recourse, and the contractual responsibilities of freight forwarders.

Scope Covered in This Article

Item	Contents Covered in This Article	Matters Requiring Separate Confirmation
Clean B/L	Meaning of a B/L without remarks indicating visible defects	Wording of individual B/L, terms of carriage, governing law
Claused B/L	Meaning of a B/L noting cargo or packaging abnormalities	Accuracy of remarks, scope, affected packaging
Mate’s Receipt	Process by which the visible condition at loading is reflected in the B/L	Issuing practices by shipping line, port, and cargo type
Container Cargo	Condition checks from Dock Receipt, EIR, CFS records, etc.	Internal container condition of CY cargo
L/C Settlement	UCP600 Article 27 and Clean Transport Document	Individual L/C terms, ISBP, bank judgment
Common Limiting Phrases	Shipper’s load and count, Said to contain, etc.	Whether individual terms imply visible defects
LOI	Risks of letter of indemnity requesting Clean B/L issuance	Validity, financial strength of issuer, P&I insurance
House B/L & Master B/L	Inconsistencies in remarks between the two B/Ls and NVOCC liability	Receipt timing and scope of checks by each carrier
Damage at Import Location	Distinguishing B/L remarks from damage at arrival	Damage cause, applicable transport segment, survey results
Cargo Insurance	Distinction between pre-existing damage and new transit damage	Individual insurance policies, exclusions, insurance period
Carrier Liability	Condition at receipt, misstatements, relation to additional damage	Applicable conventions, transport contracts, statute of limitations/notification deadlines
Freight Forwarder Liability	Scope of responsibility for B/L issuers, intermediaries, contracting carriers	Individual contracts, issued documents, received instructions

What Is a Clean B/L

A Clean B/L is a Bill of Lading that does not include any clause or remark indicating defects in the appearance of the cargo or its packaging.

The carrier’s inspection is generally limited to the visible condition of the cargo at the time of receipt or loading, insofar as it can be reasonably verified.

For example, if there are no visible damages such as tears, crushing, wetness, rust, or exposed contents on the outer packaging, and the cargo appears in good condition externally, a B/L without remarks may be issued.

However, a Clean B/L does not guarantee the following:

• There are no damages inside the packaging
• Machinery or electronic equipment functions properly
• Food or chemicals meet contractual quality or composition standards
• The declared quantity matches the actual quantity
• Proper stowage inside the container
• Cargo compliance with sales contracts or import regulations
• The absence of accidents during transit

A Clean B/L is not a certificate of cargo quality or an inspection report. It is a transport document that contains no clause or notation expressly declaring a defective condition of the cargo or its packaging within the scope reasonably visible to the carrier at the time of receipt or loading.

What Is a Claused B/L

A B/L with remarks is a Bill of Lading that records any visible abnormalities of the cargo or packaging at the time of inspection.

These remarks serve as evidence that certain abnormalities already existed when the carrier received the cargo or when it was loaded onto the vessel.

Therefore, if the same abnormalities are found at the import destination, the carrier may claim that the damage existed prior to the start of transport or from the time of receipt.

However, the descriptions on the B/L should be evaluated in terms of the type, extent, quantity, and scope of the affected packages noted.

For example, if the B/L states “2 cartons slightly dented,” but upon arrival 20 cartons show water damage and contents broken, it would not be appropriate to treat all of these as pre-existing damage.

Basic Process Until Remarks Are Recorded on the B/L

1. The shipper or freight forwarder delivers the cargo to CFS, CY, quay, shipping line, NVOCC, or other locations.
2. At the time of cargo receipt, the apparent condition of the cargo and packaging, including visible damage, wetness, rust, and any observable quantity discrepancy, is checked.
3. If abnormalities are found, they are recorded in the Dock Receipt, cargo receipt record, Tally Sheet, EIR, survey report, or similar documents.
4. For conventional vessels, heavy cargo, steel products, etc., the vessel may record the cargo’s exterior condition on the Mate’s Receipt.
5. The shipping line or B/L issuer cross-checks the Shipping Instruction against the receipt records.
6. If the Mate’s Receipt or other receipt records note exterior abnormalities, reflecting remarks on the B/L is considered.
7. The B/L Draft is presented to the shipper or freight forwarder to confirm the description, quantity, date, remarks, and other details.
8. Based on the finalized information, the Original B/L or Sea Waybill is issued.
9. For L/C transactions, the issued B/L undergoes bank examination based on the L/C terms and UCP600 regulations.

Relationship Between Mate’s Receipt and B/L Remarks

A Mate’s Receipt is a document issued by the vessel confirming that the cargo has been received or loaded on board.

For conventional vessels, bulk cargo, steel products, heavy items, and similar shipments, the master, chief officer, or other vessel personnel may note the cargo quantity and external condition on the Mate’s Receipt.

If issues such as rust, wetness, deformation, packaging damage, or quantity discrepancies are observed, these details may be recorded on the Mate’s Receipt and subsequently carried over to the Bill of Lading (B/L) issued later.

Stage	Main Documents / Records	Inspection Items	Impact on B/L
At Cargo Receipt	Dock Receipt, CFS Receipt Records	Packaging damage, wetness, quantity, labeling	May form the basis for remarks concerning the condition at receipt
At Vessel Loading	Mate’s Receipt, Tally Sheet	Cargo condition, loading quantity, damage during handling	May be reflected in B/L remarks
At Survey	Survey Report, Photographs	Rust, wetness, deformation, packaging condition	Provides evidence for drafting precise remark wording
At B/L Drafting	Shipping Instructions, Mate’s Receipt	Consistency between declared information and receipt records	Corrections or inquiries needed if discrepancies are found
At B/L Issuance	Master B/L, House B/L	Appearance condition represented by the carrier	Acts as evidence for payment and liability decisions

Issuing a Clean B/L without verifying the reasons for remarks on the Mate’s Receipt is risky.

Even if the shipper requests a Clean B/L, the B/L issuer must decide based on the actual cargo condition and receipt records.

A Mate’s Receipt Is Not Always Issued for Container Cargo

In container liner shipping, a Mate’s Receipt in the same format as for conventional cargo may not always be issued.

In such cases, the information forming the basis of remarks is confirmed from CFS in-gate records, Dock Receipt, Equipment Interchange Receipt, container exterior inspection records, terminal records, Vanning Report, photographs, tally records, and other sources.

Cargo Type	Main Documents for Condition Verification	Scope Easily Checked by Carrier	Notes
CFS-loaded LCL Cargo	CFS Receipt Records, Dock Receipt, Photographs	Appearance and quantity of individual packages	Remarks should be confirmed at CFS in-gate
Shipper-loaded FCL Cargo	EIR, Container Exterior, Seal Records	Container exterior, seal condition, etc.	Packing condition inside the container may not be visible
Conventional Cargo	Mate’s Receipt, Tally Sheet, Survey Report	Appearance of individual items and packages	Loading condition observations tend to be reflected on the B/L
Heavy and Project Cargo	Condition Survey, Mate’s Receipt, Photographs	Cargo itself, supports, packing, etc.	Detailed recording of pre-loading condition is necessary
Steel Materials	Pre-loading Survey, Mate’s Receipt	Rust, wetting, bending damage, abrasion, etc.	Specify the detail and scope of remarks

Main Types of Remarks

Example of Remark	Main Meaning	Impact on L/C	Impact on Insurance and Liability Assessment
Cartons damaged	Cartons are damaged	Often problematic for Clean Transport Document requirements	Requires comparison with similar damage at arrival
Packages torn	Packaging is torn	Often considered a remark indicating poor condition	Check for exposure, shortage, or contamination of contents
Wet marks noted	Wet marks found	Tends to be considered a significant discrepancy	Confirm causal relationship with water damage, mold, decay, rust
Rust noted	Rust found	May be problematic depending on cargo content	Distinguish between pre-shipment rust and rust developed during transport
Short shipped	Shipped quantity is less than planned	Could be a significant discrepancy with quantity condition	Verify contracted quantity, received quantity, and shipped quantity
Packing broken	Packing is broken	Often considered a remark indicating poor condition	Confirm insufficient packing and damage to contents
Pallet collapsed	Pallet has collapsed	Likely to be problematic	Check relation to cargo shifting, compression damage, or handling accidents
Contents exposed	Contents are exposed	Often considered a significant remark	High risk of theft, contamination, shortage, or damage
Cases dented	Wooden crates or cases dented	May count as a discrepancy depending on extent	Confirm impact transmission to internal machinery
Straps broken	Metal straps or bands are broken	Could be a remark for defective packaging	Confirm potential for cargo shifting or shortage
Partly unprotected	Part of the cargo is not protected	May be noted as poor condition	Check relation to water damage, abrasion, or rust
Number of packages unknown	Carrier cannot confirm the number of packages	Judgment depends on specific wording	Possibility of wording limiting the carrier's scope of check

Differences Between External Damage Remarks and Wording Limiting the Carrier’s Scope of Verification

Not all notations on the B/L indicate defective conditions of the cargo or its packaging.

Example Notation	Main Nature	Impact on Clean B/L	Points to Confirm
Shipper’s load and count	Indicates that the shipper performed container stuffing and quantity verification	Usually different from external damage remarks	Confirm that the entire phrase does not describe defective condition
Said to contain	Indicates that the contents are declared by the shipper	Usually different from external damage remarks	Note that the carrier has not verified internal quantity or quality
Weight unknown	Indicates that the carrier has not confirmed the weight	Usually different from wording expressly indicating a defective condition	Check if the L/C conditions require weight certification
Particulars furnished by shipper	Indicates that the particulars are provided by the shipper	Usually different from wording expressly indicating a defective condition	Confirm responsibility for declaration of cargo description and quantity
Cartons wet and torn	Specifically indicates defective condition of packaging	Would generally prevent the document from being treated as clean	Confirm the number, extent, and timing of occurrence

It is necessary to distinguish between the usual phraseology related to UCP600 Article 26 and the explicit indication of cargo or packaging defects which are problematic under Article 27.

UCP600 Article 27 and Clean Transport Document

In L/C transactions, presentation of a Clean B/L or Clean Transport Document may be required as a condition of the letter of credit.

Under UCP600 Article 27, transport documents that do not specify any clause or notation indicating defects in the cargo or packaging are treated as Clean Transport Documents.

It is important to note that the determining factor is not whether the word “clean” is printed on the B/L.

The focus is on whether there is any statement indicating that the cargo or packaging is defective.

Status on B/L	Basic Interpretation under Article 27	Practical Considerations
No mention of “clean” but no defect remarks either	Could be treated as a Clean Transport Document	Confirm any specific wording in the L/C
“Clean on board” stated	May be treated as clean if no other defect remarks exist	Verify the On Board date, vessel name, etc.
“Cartons wet” stated	Explicitly indicates defect in cargo or packaging	Highly likely to cause documentary discrepancy
Only “Shipper’s load and count”	Generally not considered a statement of defect	Check Article 26 and individual L/C conditions
Only “Said to contain”	Generally not considered a statement of defect	Does not guarantee internal condition or quantity
Remarks have been deleted or corrected	Authenticity and certification of corrections become an issue	Verify issuer authentication, correction history, and cargo condition

Banks review documents but do not inspect the actual cargo.

Therefore, a single phrase on the B/L may directly affect the outcome of L/C settlement.

Items to Confirm in L/C Transactions

Item to Confirm	Details to Check	Actions if Issues Arise
Clean B/L Requirement	Conditions such as Clean Transport Document, Clean on Board, etc.	Confirm with the bank and buyer before issuing the B/L
Application of UCP600	Whether the L/C is subject to UCP600	Determine the applicable rules
ISBP	Examination under international standard banking practice	Consult the bank prior to presentation
On Board Notation	Shipment date, vessel name, loading port	Obtain the required On Board notation
Remarks	Whether any defects in cargo or packaging conditions are clearly indicated	Consider waiver or amendment of L/C conditions
Consignee	To Order, bank name, buyer name, etc.	Ensure consistency with L/C conditions
Freight Indication	Freight Prepaid, Collect, etc.	Match with Incoterms and L/C
Corrections	Person making the correction, authentication, and consistent correction of all originals	Obtain formal correction from issuer

Situations Where an LOI Is Submitted to Request a Clean B/L

Even if there are visible abnormalities in the cargo or packaging, exporters or charterers may request the issuance of a Clean B/L due to reasons such as L/C settlement or sales contract requirements.

In such cases, a Letter of Indemnity (LOI) may be submitted to the carrier, requesting the issuance of the B/L without any remarks.

An LOI is a document in which the submitter promises to indemnify the carrier within a certain scope in the event that the carrier suffers damages or claims arising from acting on the request.

However, an LOI does not alter the actual condition of the cargo.

Even if an LOI is submitted, the facts that the cargo was wet, the packaging was damaged, or that there were remarks on the Mate’s Receipt remain unchanged.

Legal and Practical Limitations of LOI

Issue	Basic Position of LOI	Remaining Risks
Relationship with Carrier	Contract whereby the requester compensates the carrier for damages	Scope of compensation and claim conditions may be disputed
Relationship with Buyer	Generally, not a document binding the buyer	Buyer may claim for B/L misstatements or cargo damage
Relationship with Banks	Usually does not bind the presenting or issuing banks	Discrepancies, false statements, or fraud could become issues
Relationship with Insurers	Insurance companies are not automatically bound by LOI	Exclusions or subrogation issues may arise under P&I or cargo insurance
Credibility of the Guarantor	Assumes the guarantor can fulfill the obligation	Cannot recover if guarantor becomes insolvent or lacks financial capacity
Improper Purpose	Assumes compensation within lawful scope	LOI validity may be denied if issued knowing false statements
Third-Party Claims	Does not prevent third-party claims per se	Carrier may compensate third parties first, then claim under the LOI

LOI is not an exoneration document but a compensation contract intended to shift risk back to another party.

When a Clean B/L is issued despite recognizing outward discrepancies, the existence of an LOI does not eliminate external liability of the carrier, NVOCC, or signatories.

Matters to Confirm Before Submitting an LOI

• Contents of the Mate’s Receipt, Dock Receipt, and Survey Report
• The actual condition of the cargo or packaging
• Whether the remark is a minor wording issue or a clear visible defect
• The reason for requesting a Clean B/L
• L/C terms and the buyer’s understanding
• Creditworthiness and financial capacity of the LOI submitter
• Whether an LOI with a bank guarantee is required
• Scope of indemnity, amount, period, governing law, and jurisdiction
• Whether consultation with the P&I insurer is necessary
• Approval from the B/L authorized signatory and the head office legal department
• The possibility that a third party may rely on the B/L statement

Discrepancies in Remarks Between Master B/L and House B/L

When an NVOCC or freight forwarder issues a House B/L, a separate carriage contract is established from the Master B/L issued by the Actual Carrier or shipping line.

As the contracting carrier to the shipper, the NVOCC or House B/L issuer may be held responsible for statements contained in the House B/L it issues.

If the Master B/L contains remarks indicating irregularities in cargo or packaging appearance, but a Clean House B/L is issued without verifying the reasons, the House B/L holder receives a representation that the cargo was received in apparent good condition.

Master B/L	House B/L	Main Issues	Required Actions
Clean	Clean	Usually no apparent inconsistency in the description of condition	Confirm the underlying receiving records
Claused	Claused with the same remarks	The same apparent condition is reflected in both B/Ls	Verify consistency of quantities and wording
Claused	Clean	The NVOCC may be alleged to have disregarded apparent irregularities	Investigate the basis of the remark, re-inspect the cargo if necessary, and obtain legal advice before issuance
Clean	Claused	Possible irregularities identified by NVOCC at their receipt	Check timing of irregularities and supporting documentation
Different remarks	Different remarks	The carriers may have received the cargo at different times or inspected different aspects of its condition	Organize the information chronologically rather than simple transcription
Master B/L not yet issued	Urgent House B/L issuance	Remarks may later be added to the Master B/L	Review receiving records and Mate’s Receipt first

This does not mean that the wording of House B/L and Master B/L must always match exactly.

They may be issued by different contracting carriers based on different receiving times and scopes of inspection.

However, when the NVOCC knowingly issues a Clean House B/L despite awareness of the same appearance irregularities, it seriously affects the contracting carrier’s liability, L/C settlements, marine cargo insurance, P&I insurance, and claims recovery.

Verification Items Before Issuing House B/L

Documents to Verify	Verification Details	Actions if Discrepancies Found
CFS / Dock Receipt	Packing condition and quantity at receipt	Confirm with on-site personnel
Mate’s Receipt	Remarks noted at vessel receipt	Confirm cause and scope of remarks
Master B/L Draft	Condition description planned by the shipping line	Identify and resolve inconsistencies with the House B/L
Survey Report	Type, extent, and quantity affected by damage	Reflect precise wording in the remarks
Photographs	Objective condition of external abnormalities	Share with the issuance approver
L/C	Request for Clean Transport Document	Consider waiver requests to buyer or bank
LOI	Coverage scope, issuer, creditworthiness	Do not decide Clean issuance based on LOI alone

When Damage Is Found at the Import Location

If damage to the cargo is discovered at the import location, first check whether the B/L is Clean or Claused.

If it is a Clean B/L, this means that the visible abnormalities were not noted on the B/L at the time of receipt by the carrier or at shipment.

Therefore, the possibility must be considered that the damage occurred during transportation, cargo handling, storage, or inland delivery.

If the Claused B/L describes similar damage, it is necessary to distinguish whether the damage was pre-existing or if it worsened during transit.

Damage Discovery Confirmation Timeline

Timing	Confirmation Items	Main Documents	Actions
Before Gate-Out	B/L remarks, Container/Cargo appearance	B/L, D/O, EIR, CY/CFS records	Record abnormalities and notify relevant parties prior to gate-out
At Gate-Out	Packing damage, wetness, quantity discrepancies, Seal	Photos, POD, delivery records	Note reservations on the delivery receipt and notify the relevant parties immediately
Upon Warehouse In-Gate	Check if damage has increased after gate-out	Warehouse entry records, cargo inspection, photos	Isolate and determine need for survey
At Unpacking	Relationship between external damage and internal damage	Unpacking photos, packaging materials, inspection records	Preserve packaging materials and notify of incident
At Survey	Cause, extent, repairability, transport stage or segment in which the damage occurred	Survey Report, temperature/humidity and transport records	Investigate with insurance company and carrier
At Claim	Match or discrepancy between B/L remarks and actual damage	B/L, POD, survey, insurance policy	Organize claims and recoveries by cause

Distinguishing B/L Remarks from Arrival Damage

Notation on B/L	Condition upon Arrival	Basic Interpretation	Additional Verification
No remarks	External packaging damaged	Consider the possibility of damage during transportation or cargo handling	Gate-out records, photos, survey report
Cartons damaged	Damage to cartons in the same area	May have existed at the time of receipt	Compare number of affected cartons and damage severity
Cartons damaged	Also water damage/internal damage present	Possible new damage outside the remark	Investigate cause of wetness and section where it occurred
Wet marks noted	Expansion of mold, decay, rust	Separate existing moisture issues from damage worsening during transportation	Temperature/humidity, container, ventilation records
Short shipped	Shortage of the same quantity	High possibility of shortage before shipment	Booking, Packing List, Tally Sheet
Remarks present	New damage at a different location	May be considered a separate transit-related incident	Damage location, photos, timeline
Said to contain	Internal quantity shortage	Likely beyond carrier’s scope of verification	Seal, Vanning, unpacking records
Shipper’s load and count	Load shift inside container	Consider both shipper’s loading and accident during transportation	Vanning photos, securing methods, impact records

Relation to Cargo Insurance

When damage is found on arrival under a Clean B/L, an accidental event during transit is one possible explanation, but the cause and timing must still be established from the available evidence.

Conversely, existing damage noted on a Claused B/L may raise issues such as damage occurring before attachment of cover, known damage, or inadequate packing.

Status	Main Issues in Marine Cargo Insurance	Required Documents
Clean B/L - Damage on Arrival	Accident during transit, insurance period, insured risks	B/L, photos, POD, Survey Report
Claused B/L - Same Damage	Was this damage existing before insurance attachment?	Mate’s Receipt, pre-shipment photos
Claused B/L - Damage Worsening	Can the additional damage during transit be separated?	Condition comparison at departure and arrival
Claused B/L - Different New Damage	Can this be treated as a new insurable incident?	Damaged area, timeline, survey
Quantity Remark	Is the issue physical damage or a shortage in contractual quantity?	Invoice, Packing List, Tally Sheet
Poor Packaging Remark	Relation to exemption due to insufficient packing	Packing specifications, photos, cause of the accident

Notification to the marine cargo insurer should be made promptly after discovery of the incident, without waiting for determination of carrier liability.

Relation to Carrier Liability

Situation	Main Perspective on Carrier Liability	Points to Confirm
Same type of arrival damage with Clean B/L	The Clean B/L may support an inference that the apparent damage occurred after receipt, subject to contrary evidence and applicable defenses	Management during transport, exemption grounds
Same damage with Claused B/L	Possible to claim damage existed at time of receipt	Number and extent of remarks
Worsening of damage under a Claused B/L	Potential liability for the additional damage	Proper storage, stowage, ventilation
New damage not noted in remarks	Liability for new damage may be subject to review	Time, segment, and cause of occurrence
Issuance of inaccurate Clean B/L	Liability for description to bona fide B/L holders becomes an issue	Issuance background, awareness, LOI
Only House B/L is Clean	Contracting Carrier liability of the NVOCC becomes an issue	Master B/L, receipt records, issuance decision

Items to Confirm in Subrogation Practice

• Whether the B/L is Clean or Claused
• Notes on the Mate’s Receipt or Dock Receipt
• Remarks on the Master B/L and House B/L
• Pre-shipment and arrival photos
• Number, extent, and locations of damaged packages
• Delivery records at CY or CFS gate-out
• Remarks on the POD
• Condition of container exterior, seal, floor, roof, and doors
• Records of temperature, humidity, ventilation, voyage, and cargo handling
• Surveyor’s assessment of cause
• Notice of Claim to the carrier
• Whether there is an LOI and who submitted it
• Whether subrogation by the marine cargo insurer is possible
• Applicable conventions, notice deadlines, and statutes of limitation under transport terms

Freight Forwarder's Scope of Responsibility

Simply sending the Shipping Instruction, forwarding the B/L Draft, or conveying the shipper’s correction requests to the shipping line does not necessarily mean the forwarder assumes responsibility as the B/L issuer.

On the other hand, when the forwarder issues a House B/L as an NVOCC, they may bear responsibility as the contracting carrier towards the shipper for the content of their B/L and the delivery of the cargo.

Issue	Main Responsible Party	Forwarder's Involvement	Confirmation Documents
Declaration of Cargo Condition	Shipper, packer, party delivering the cargo	Conveys declared and received information	Shipping Instruction, in-gate records
Issuance of Master B/L	Shipping line, Actual Carrier	May confirm draft and request corrections	Master B/L, Mate’s Receipt
Issuance of House B/L	NVOCC, House B/L issuer	Determines and approves the B/L content themselves	House B/L, receipt records
Removal of Remarks	B/L issuer, authorized signatory	May forward shipper’s request	Correction request, Letter of Indemnity (LOI), approval records
Letter of Credit (L/C) Compliance	Exporter, bank	Shares practical information	L/C, B/L Draft
Cargo Insurance Decision	Insurance company	Supports collection and submission of incident documents	Insurance policy, incident report
Carrier Liability Determination	Contracting Carrier, Actual Carrier, etc.	Organizes relevant transport segments and issued documents	Transport contract, B/L, Proof of Delivery (POD)

Organization by the Freight Forwarder’s Standard Five Classifications

The following Standard Five Classifications are not categories established by law or the entire industry, but rather an analytical framework used in this series to organize the scope of freight forwarder involvement.

Standard Five Classifications	Tasks Possibly Performed Related to Clean B/L and Remarks	Judgments and Guarantees Normally Not Included	Documents to Confirm Responsibility Scope	Practical Points to Note
Simple Intermediary	Transmission of Shipping Instructions, remarks, correction requests, etc.	Guarantee of B/L legal compliance, L/C payment, and insurance applicability	Email, quotation, work instructions	Communicate information accurately without altering received data
Cargo Transportation Service Provider	Arrangement of in-gate, transportation, storage, and accident notification	Quality of cargo, bank settlement, shipping line’s B/L issuance decisions	Contract of carriage, booking, terms of carriage	Clearly define the segments and operations entrusted directly
NVOCC / House B/L Issuer	Issuance of House B/L, notation of remarks, cargo delivery management	Guaranteeing that the issuance of a Clean B/L is appropriate despite discrepancies with the actual cargo condition	House B/L, receipt records, Master B/L	May bear responsibility for statements as Contracting Carrier
Door-to-Door Single Contractor	Integrated management of pickup, CFS, ocean transport, customs clearance, and delivery	Guarantee of L/C settlement, cargo quality, and insurance payment	Door-to-Door contract, terms of carriage, instruction records	Distinguish between through-transport responsibility and sales/payment responsibilities
Agent / Coordinator for Specific Operations	Acts as an agent or coordinator for B/L verification, survey arrangements, and inquiries to banks or insurers	B/L issuance judgments and legal liability confirmation beyond the scope of delegation	Power of attorney, work instructions, confirmation reports	Distinguish between acting as confirmation agent and making final judgments

“Contracting Carrier” and “Actual Carrier” refer to legal or contractual positions and do not replace the Standard Five Classifications.

Individual tasks such as forwarding a B/L draft, remark inquiries, receipt of LOI, photo sharing, or survey arrangements do not constitute a sixth classification by themselves.

Common Practical Problem Cases

Case	Main Issue	Key Points for Judgment	Initial Response	Main Documents
Remark on Mate’s Receipt	Discrepancy with Clean B/L issuance request	Actual cargo condition and basis for the remark	Confirm photos and survey reports	Mate’s Receipt, photos
Master B/L is Claused, House B/L is Clean	NVOCC’s responsibility for descriptions	Whether the abnormality was recognized	Suspend issuance of the House B/L	Master B/L, House B/L, receipt records
Request for Clean B/L by Letter of Indemnity (LOI)	False statement and third-party claims	Validity of LOI and cargo condition	Consult legal team and P&I insurer	LOI, survey report
Bank points out discrepancy under L/C	Suspension of payment settlement	Article 27 and L/C-specific conditions	Consider waiver or amendment of conditions	L/C, B/L, bank notification
Damage upon arrival with Clean B/L	Possible incident during transport	Section and cause of occurrence	Notify insurer and submit Notice of Claim	Photos, POD, survey
Worsening of damage under a Claused B/L	Coexistence of pre-existing and additional damage	Difference between departure and arrival	Separate the pre-existing damage from the additional damage	Photos before and after loading, survey report
Mistakenly interpreted standard text as Clausing	Unnecessary payment or shipment halt	Whether a defective condition was explicitly stated	Check Articles 26 and 27	B/L, L/C
Remark removed without permission	Document tampering and issuance authority	Who corrected what	Recover all original B/L sets and make a formal correction	Correction history, Original B/L

Example 1: When Clean B/L Is Requested for Cargo with Wet Remarks on the Mate’s Receipt

For machinery and equipment transported by conventional vessel, wetness was observed on the surface of some wooden crates due to rainfall at the time of loading.

The vessel’s representatives recorded the following on the Mate’s Receipt: “Five cases wet before shipment.”

The exporter was required by the L/C to present a Clean on Board B/L, so they submitted a Letter of Indemnity (LOI) and requested deletion of the remark.

After the shipping line and NVOCC reviewed photos and the survey report, it was concluded that the wetness was not merely surface water droplets but may have penetrated inside the wooden crates.

Issuing a Clean B/L in this condition could constitute a false representation to the bank and buyer that the cargo was loaded in good condition externally.

Ultimately, the remark reflecting the actual condition was maintained, and the exporter explained the situation to the buyer, requesting a waiver of the L/C requirement.

A Letter of Indemnity does not justify discrepancies between the cargo’s condition and the description on the B/L.

Example 2: Issuing a Clean House B/L Despite Remarks on the Master B/L

An NVOCC accepted multiple machines packed in wooden crates as LCL cargo and issued a House B/L to the shipper.

When the cargo was delivered to the CFS, some corner damage to the wooden crates was recorded; however, concerned about the impact on the L/C settlement, the responsible staff issued a Clean House B/L first.

Subsequently, the Master B/L issued by the shipping line included the remark “Two cases corner damaged.”

At the import destination, damage was found inside the same wooden crates, and the holder of the House B/L claimed compensation from the NVOCC based on the Clean House B/L.

The NVOCC argued that the Master B/L issued by the Actual Carrier included the remark, but it had not noted any abnormalities on the House B/L it issued.

The House B/L issuer is not merely a transmitter of the Master B/L but acts as the Contracting Carrier in relation to the shipper, and may be held responsible for the statements on its own documents.

Example 3: When Existing Damage Noted on a Claused B/L and New Damage at Arrival Coexist

The B/L stated "Three cartons dented" as the condition at the time of loading.

Upon inspection of the cargo at the import destination, in addition to dents on those three cartons, water damage and mold were found on another ten cartons.

The carrier argued that, since the B/L contained this remark, all the damage existed before loading.

However, pre-shipment photos showed no signs of water damage, and a crack was found in the roof of the arriving container.

The surveyor classified the denting on the three cartons as existing damage, while the water damage and mold were categorized as new damage caused by rainwater intrusion during transit.

Even with a Claused B/L, the abnormalities noted on it are not necessarily the same as the damage found upon arrival.

Example 4: Stopping L/C Presentation Due to Misidentifying Standard Phrases as Remarks

The container cargo B/L included the phrases "Shipper’s load, stow and count" and "Said to contain."

The exporter's representative considered these to constitute a Claused B/L and consequently withheld the document from presentation to the bank.

Upon review, the B/L did not explicitly indicate any defects in the cargo or packaging. These phrases were standard wording limiting the carrier’s scope of confirmation for shipper-loaded containers.

Under UCP600 Article 27, the presence or absence of clauses or notations explicitly indicating defects in the cargo or packaging is the relevant issue.

After prior confirmation with the responsible bank, the B/L was accepted as a Clean Transport Document for presentation.

It is necessary not to assume that all notations represent defect remarks, but to verify the legal and practical nature of the wording used.

Example 5: When the LOI Submitter Goes Bankrupt and Compensation Cannot Be Obtained

During the shipment of steel materials, widespread surface rust was confirmed.

The charterer, requiring a Clean B/L under their contract with the buyer, submitted an LOI to the shipowner.

The shipowner accepted the LOI and issued a B/L without any rust remarks.

After arrival, the B/L holder claimed compensation from the shipowner for the rust damage to the steel materials, arguing that the Clean B/L indicated the cargo was apparently in good condition at the time of shipment.

The shipowner sought indemnity from the charterer based on the LOI; however, the charterer had already gone bankrupt.

An LOI does not prevent third-party claims, and if the submitter cannot fulfill the indemnity, the carrier may ultimately bear the loss.

Common Misunderstandings

Misunderstanding	Actual Concept	Practical Points to Note
A Clean B/L is a certificate guaranteeing the quality of the cargo	It is a document without defective remarks concerning the verifiable external condition	The internal condition, performance, and composition should be confirmed separately
If "clean" is not written on the B/L, it is not Clean	Article 27 emphasizes whether there is explicit mention of defects	Unique conditions of L/C should also be checked
“Shipper’s load and count” is a remark of a Dirty B/L	Generally, it limits the carrier’s scope of inspection	Confirm there are no accompanying defect remarks
A Mate’s Receipt is unrelated to the B/L	It can serve as the basis for B/L clauses as a record of condition at shipment	Verify it before B/L issuance
Submitting an LOI removes remarks	An LOI is a compensation agreement and does not justify false statements	Confirm cargo condition and legal validity
Having an LOI prevents claims from third parties	It does not prevent claims from buyers, banks, or other third parties	The carrier may satisfy the third-party claim first and then seek indemnity from the LOI issuer
Even if the Master B/L is Claused, a House B/L can be freely issued as Clean	Accurate description based on the NVOCC’s own receipt condition and understanding is required	Verify contracting carrier liability
If a B/L has remarks, the carrier is fully exempt from liability	New damage or worsening of existing damage outside the noted remarks is a separate issue	Compare with damage at arrival
A Clean B/L always means the carrier is liable	The carrier may rely on applicable defenses and dispute causation	Check cause of incident and applicable clauses
If there are remarks, marine cargo insurance cannot be used at all	There may be scope to cover new damage or worsening of existing damage during transit	Separate damages by cause
Freight forwarders only forward the shipping line’s B/L and bear no responsibility	The issuer of the House B/L may be liable as contracting carrier	Check the Standard Five Classifications and the documents issued
Vague remarks are safer	If the subject, quantity, or extent is unclear, future disputes increase	State specifics objectively and concretely

Decision Flow at the Time of B/L Issuance

1. Confirm whether the cargo type is FCL, LCL, conventional vessel cargo, heavy cargo, or other type.
2. Check CFS receipt records, Dock Receipt, EIR, Mate’s Receipt, etc.
3. Inspect the cargo or packaging for any external abnormalities.
4. If abnormalities exist, record their type, extent, affected quantity, and location.
5. Retain photographs, Survey Reports, and Tally Sheets.
6. Verify that the Shipping Instruction matches the actual received condition.
7. Confirm whether both the Master B/L and House B/L will be issued.
8. Review any remarks on the Master B/L Draft.
9. The House B/L issuer should reconcile their own receipt record with the Master B/L.
10. Check if this is an L/C transaction.
11. Confirm whether the L/C requires Clean Transport Documents.
12. Distinguish between standard limiting phrases and remarks indicating external damage.
13. If an LOI requesting Clean B/L issuance is submitted, consult legal counsel, P&I, and relevant parties.
14. Do not remove remarks based solely on the LOI.
15. Verify remarks, quantities, dates, and signature authorization on the B/L Draft.
16. Save the finalized version together with the underlying reference documents.

Checklist for Judgments at the Import Location

Verification Stage	Counterparty / Documents	Items to Check	Actions If Issues Are Found
When Receiving Arrival Notice	B/L, Arrival Notice	Clean or Claused, Cargo and Container Information	Share the remarks content with relevant parties
Before Gate-Out	CY, CFS, EIR, D/O	Appearance, Seal, Remarks	Keep photos and records before removal
At Gate-Out	POD, Delivery Record	Packaging Damage, Wetness, Quantity Discrepancies	Record reservations on the delivery receipt
At Warehouse Receipt	Receipt Records, Photos	Extent of Damage and Any Increase	Isolate cargo and consider survey
At Unpacking	Inspection, Surveyor	Relationship Between Outer Packaging and Internal Damage	Preserve packaging materials and damaged goods
When Notifying Insurance	Insurance Company, Agent	Date of Incident, Cause, Scope of Damage	Promptly provide preliminary notification
When Notifying Carrier	Carrier, NVOCC	Notice of Claim, Responsibility Segment	Send written notice within the deadline
When Organizing Causes	B/L, Mate’s Receipt, Survey	Existing Damage, New Damage, Worsening of Existing Damage	Separate damages by cause
When Making Claims	Insurance Company, Lawyer, etc.	Contracting Carrier, Actual Carrier, LOI	Identify the proper claim target and organize the supporting evidence

Situations Requiring Consultation with Experts

• When there is a dispute over whether to reflect remarks from the Mate’s Receipt onto the B/L
• When requested to issue a Clean B/L in exchange for an LOI
• When asked to remove remarks despite recognizing physical abnormalities
• When remarks on the Master B/L and House B/L do not match
• When an NVOCC has already issued a Clean House B/L
• When it is unclear whether the Clean Transport Document condition of an L/C is met
• When the application scope of UCP600 Article 26 and Article 27 is unclear
• When the authenticity of B/L correction or removal of remarks is in question
• When existing damage and new damage coexist at the import location
• When the cargo insurance company or carrier claims full exemption based on a Claused B/L
• When the party providing the LOI goes bankrupt or becomes unable to pay
• When inaccurate B/L details cause claims from the bank or buyer
• When the P&I coverage or exclusions is an issue
• When the Notice of Claim to the carrier or the time bar for recourse or recovery claims is approaching

Points to Note

• A Clean B/L is not a certificate of cargo quality.
• A Clean B/L indicates only the apparent condition within the carrier's ability to inspect.
• It does not guarantee the cargo's interior, quality, performance, or declared quantity.
• Remarks may arise based on documents such as the Mate’s Receipt, Dock Receipt, or Survey Report.
• Mate’s Receipts may not be used for containerized cargo.
• Distinguish between standard phrases like "Shipper’s load and count" and exterior damage remarks.
• Under UCP600 Article 27, the presence or absence of statements indicating defects is more important than the word "clean."
• Do not casually remove remarks if exterior abnormalities are apparent.
• An LOI does not alter the cargo condition nor prevent third-party claims.
• If a Clean B/L is issued despite recognition of false statements, the validity of the LOI and P&I insurance coverage could be at risk.
• Verify the creditworthiness and financial standing of the LOI issuer.
• If the Master B/L is Claused, do not issue a Clean House B/L mechanically.
• Issuers of House B/Ls should reconcile their own receipt records with the Master B/L.
• Even with a Claused B/L, confirm there has been no new damage or aggravation during transit.
• If any abnormalities are found at the import location, preserve evidence from before and after cargo gate-out.
• Notify cargo insurance and submit a Notice of Claim to the carrier promptly.

Summary

• A Clean B/L is a Bill of Lading without any remarks indicating any defects in the cargo or packaging.
• A Claused B/L is a Bill of Lading that includes notes on abnormalities in the cargo or packaging confirmed at the time of receipt or loading.
• A Clean B/L does not guarantee the quality, performance, composition, internal condition, or declared quantity of the cargo.
• B/L remarks may be based on documents such as Mate’s Receipt, Dock Receipt, Tally Sheet, or Survey Report.
• For conventional vessels, steel materials, heavy cargo, etc., remarks on the Mate’s Receipt may be reflected on the B/L.
• In container liner shipping, records such as CFS documents, EIR, and Dock Receipt may serve as sources for condition confirmation.
• It is necessary to distinguish between specific descriptions of cargo or packaging defects and standard phraseology limiting the carrier’s scope of inspection.
• Terms like "Shipper’s load and count" or "Said to contain" usually differ from remarks indicating visible defects.
• According to UCP600 Article 27, the absence of any indication of cargo or packaging defects is the criterion for determining a Clean Transport Document.
• It is not mandatory for the word "clean" to be printed on the B/L itself.
• Distinct confirmation is required for unique L/C requirements, ISBP guidelines, and overall consistency of presented documents.
• A Letter of Indemnity (LOI) is a contract to compensate the carrier for damages incurred following the request.
• An LOI does not alter the condition of the cargo, nor does it automatically bind third parties such as the buyer, bank, or insurer.
• Submitting an LOI does not necessarily enable the safe issuance of a Clean B/L different from visible abnormalities.
• If the LOI provider becomes insolvent or unable to pay, the carrier may be unable to recover compensation.
• Issuing a Clean B/L while knowingly making false statements may raise issues regarding the validity of the LOI, third-party liability, and P&I insurance coverage.
• Master B/L and House B/L are documents evidencing separate contracts of carriage, but inconsistencies in condition descriptions of the same cargo should be reviewed for unreasonableness.
• If the Master B/L contains remarks but the House B/L is issued clean, the NVOCC’s Contracting Carrier liability may become an issue.
• NVOCCs and House B/L issuers are not mere transmitters of the Master B/L.
• At the import location, remarks on the B/L are compared with the type, extent, and quantity of damage upon arrival.
• Even if the same damage is described in a Claused B/L, it is necessary to check for any worsening of existing damage or new damages.
• If damage is found despite a Clean B/L, possible accidents during transport, handling, or storage should be considered.
• In marine cargo insurance, existing damage and new damage during the insurance period should be separately identified.
• For carrier liability, the condition at receipt, B/L remarks, cause of damage, and applicable conventions and clauses should be reviewed.
• Photographs, Proof of Delivery (POD), Equipment Interchange Receipts (EIR), Mate’s Receipt, and Survey Reports are important documents for determining the timing of damage occurrence.
• When a freight forwarder issues a House B/L, their responsibilities as an NVOCC and House B/L issuer as defined in the Standard Five Classifications must be confirmed.
• Contracting Carrier and Actual Carrier are legal and contractual positions and do not replace the Standard Five Classifications.
• Activities such as transferring B/L drafts, querying remarks, receiving LOIs, and arranging surveys do not themselves constitute a sixth classification.

Before issuing a B/L, please reconcile not only the Shipping Instruction but also the Mate’s Receipt, CFS/CY receipt records, Survey Report, photographs, and Master B/L draft.

If a Clean B/L is requested despite visible abnormalities, do not rely solely on the LOI. Confirm responsibility for remarks toward third parties, the creditworthiness of the LOI provider, P&I insurance coverage, and L/C conditions.

If damage is discovered at the import location, do not immediately abandon claims even with a Claused B/L. Use evidence to distinguish between existing damage, new damage, and worsening of existing damage.

This article provides general practical guidance on Clean B/L, Claused B/L, Mate’s Receipt, Master B/L, House B/L, UCP600 Article 27, LOI, marine cargo insurance, and carrier liability. It does not determine the legal validity of individual B/Ls, L/C compliance, effectiveness of LOIs, insurance applicability, or the responsibilities of carriers, NVOCCs, freight forwarders, or other parties. Actual handling should be verified based on the B/L, Mate’s Receipt, carriage contracts, L/C, UCP600, ISBP, sales contracts, insurance clauses, applicable conventions, governing law, and judgments by banks, carriers, insurers, and experts.