What is a Delivery Order and who issues it..??

In this article we will discuss about What a Delivery Order is, its importance and who issues it.. This article is based on a user question as below :

Dear sir, pl tell who issues delivery order “overseas counterpart of the freight forwarder or overseas counterpart of the carrier”. from Priyankara

In one of my previous articles I wrote in detail about what a Bill of Lading is and its importance in the whole shipping cycle..

A Delivery Order is another such important document in the shipping cycle and in an ideal cycle you can call it the climax of the cycle.. The parting of ways of the cargo and the carrier if you wish.. 🙂

Image for Delivery Order

A Delivery Order is a document issued by the carrier, in exchange for 

  1. One or all duly endorsed Original Bill(s) of Lading or duly authorised and issued Bank Guarantee
  2. A Telex Release confirmation from the loading port or principal confirming surrender of one or all Original bills of lading issued for the shipment
  3. A copy of a Seawaybill issued

releasing the cargo to the legal consignee mentioned in the bill of lading..

Only with this delivery order the consignee can clear the cargo with customs and take delivery of the cargo from the port or terminal or depot or wherever it is stored..

As mentioned in my post about Bill of Lading and duly discharged bills of lading, it is very important that the releasing agent issues the Delivery Order to the right entity as this document is the final frontier before the cargo is released and it cannot be reversed under normal circumstances..

So who issues this important document..?? The Delivery Order is issued by the carrier of the cargo directly if they have their own office at the destination or by their authorised destination agent on behalf of the main carrier..

Depending on the service type of the container which is indicated on the bill of lading, this may also be issued by the Groupage Operator for LCL/LCL cargoes..

In cases where a House Bill of Lading (HBL) has been issued by a Freight Forwarder, the Freight Forwarder’s counterpart agent at destination will collect his Original HBL and issue a Release Letter to the main carrier requesting that their Delivery Order be issued to the nominated consignee.. In most cases where HBL is issued, the Master Bill of Lading (MBL) will be either a Seaway Bill or will be Telex Released to facilitate easy release..

Based on this release letter, the main carrier will release the Delivery Order to the nominated consignee..

The issuance of the Delivery Order signifies the end of the shipment cycle for that shipment and once the Delivery Order has been issued, the bill of lading maybe considered as duly discharged and accomplished.. It may also be considered as the end of the contract between the carrier and the consignee for that particular shipment..

This is of course assuming that the consignee takes delivery of the cargo promptly after securing the Delivery Order.. Hmmmm, abandoned cargo is another story all on its own which I will write about in due course..


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24 comments on “What is a Delivery Order and who issues it..??”

  1. By dhiraj rathod Reply

    Hi i have issue regarding my shipment
    Shipping company from origin port
    Has put my D/O on hold
    And they showing reason that my shipping agent haven’t done payment regarding the shipment, I have copy of surrenderd B/L,
    Packing list and invoice of shipment
    What steps should I follow to clear my shipment as I don’t have D/O ?
    Thank you

  2. By I Galely Reply

    What advantage is there for the importer to have a HBL issued AND MBL (by way of telex release), over the more simpler procedure of just having a MBL issued and then getting the DO after surrendering the original MBL?
    And, does it not mean that in lieu of the MBL, once a telex release is provided, the HBL is irrelevant?

    • By Hariesh Manaadiar

      Hi Galely, there is no advantage or disadvantage for the importer as such whether a HBL is used or MBL is used.. As far as the importer is concerned they will only receive 1 bill of lading and that should be the HBL.. So in the case where there is a HBL, they are only concerned about this.. Even if the MBL is telex released, the original HBL will still need to be surrendered before they get the DO from the discharge port agent mentioned in the HBL..

  3. By Samare Reply

    If a HBL is involved in the Carriage of goods and if the goods are consigned to a bank , it’s whose responsibility to ensure that the original BL has been endorsed by the bank before releasing the cargo to the purchaser. The named destination agent in the BL or the Carrier/their local agent or both ? .

    • By Hariesh Manaadiar

      Whether it is a HBL or MBL, it is the responsibility of the agent of the bill of lading to ensure proper endorsements are made on the bill of lading before release..

    • By Samare

      Sorry is it the destination agent on the BL or the Carrier’s local agent will be responsible

    • By Hariesh Manaadiar

      The agent of the bill of lading that is used as the transport document for final release.. So if HBL is used then the destination agent of the forwarder (normally) and if MBL then destination agent of the shipping line..

  4. By pn iyengar Reply

    In a LCL Container ( cargo) arrived at a Gateway Port and sent to a CFS , can the Liner company deny issuing a D.O. to a CHA and insist that D.O.s will be issued simultaneously only when all the CHA come together to claim their cargo packed in LCL. Is it correct and if not, what exactly is the practice / procedures adopted by any Shipping Lines to the CHA in issuing a D.O. .

    • By Hariesh Manaadiar

      Hello PN, if the cargo is an LCL cargo and unpacked at the CFS then I don’t see a reason why the shipping line will refuse issuance of DO..

  5. By C M Taylor Reply

    I think you need to address a bit wider use of a delivery order with regard to the daisy chain of releases on inbound cargo.

    As the cargo enters port, it is under the bond and control of the carrier. The carrier will enforce collection of its monies and the bill of lading and Customs/Ag releases, etc., and will advise when its requirements and its other legal requirements it monitors have been met. But there are other parties in the line of control, so that the carrier notification simply passes the opportunity to release to others.

    If the carrier has a clear path to release to the consignee when the carriers requirements are met and no other responsibilities, they would be in a position to financially damage others who still have a financial or jurisdictionally valid claim to the goods.

    Around these digs, for instance, the carrier does not know what entity is next in the line of custody unless someone, such as the importer of record or his Customs Broker gives a “delivery order” to the ship line.

    Even though the goods are released by the line, the carrier is not free take an independent flier and ignore the interests others may have in the goods.

    The bill of lading endorsement is applicable to the carrier only. The carrier releases to the broker or to its own agent, not directly to the consignee.

  6. By Jeremy Reply

    Good afternoon, if a shipment has an ocean B/L that ends at the port (i.e. Los Angeles) but it will be delivered to an interior location (i.e. Kansas City), can this freight move on a delivery order to destination or does it need a domestic straight bill of lading?
    Thanks

  7. By Shankar Pilane Reply

    If the B/L is consigned ”To Order” & importer name is mentioned in notify party column as 1st notify or 2nd notify & Bank name is mentioned as 2nd Notify party or say 1st Notify party. In this case if shipper has endorsed the B/L then still we need to get the endorsement of Bank mentioned in notify party to release the Delivery Order? As per my knowledge it is not required. Pls correct me if I am wrong.

    • By Hariesh Manaadiar

      Hello Shankar, endorsement is required only dependent on what is shown in consignee column.. Notify party column has only the info of the people that need to be “notified”.. Nothing else.. So your understanding is correct..

  8. By Wasi Shah Reply

    Kindly let me know, In import FCL in which HBL is involved and who will Endorse on HBL and who Will Endorse on MBL

  9. By Hariesh Manaadiar Reply

    Hi Gowri, If it is the actual consignee mentioned in the bill of lading, then he doesn’t need to.. If the consignee is asking you to release the DO to someone else, then he should give an authorisation letter on his original letter head stamped and signed..

  10. By Vincent Reply

    Reading your article, let me add some details about current process within a world shipping carrier : Delivery order is issued when you get documentation (as you mentioned) but also after the carrier (or its agent) has checked that all invoices have been paid , that there is no pending charges. in some countries they also check that a empty return depot is defined and in some other (rare) cases that customs clearance has been performed (or at least Information systeme got the green light). Delivery order, for carrier, is a confirmation that client is ‘free’ of any duty and is entitle to get his container for import haulage.

    • By Hariesh Manaadiar

      Hi Vincent, thanks for your comments with valid points, appreciated.. I would say that in most countries Delivery Order will be issued only after customs clearance has been done and proof of such clearance submitted to the shipping line.. It would be considered in contravention of the Customs Act if cargo is released to the consignee without it being cleared for release by Customs..

    • By Vincent

      You’ re right, sorry. but in case of existing PCS, shipping line not always check customs clearance bu give his green ight (documentation, settlement) and then PCS collect customs green light to give final green light to customer. But most of the agencies are really checking on customer website directly.

  11. By murthy ramana Reply

    Hi Hariesh

    In case HBL, I think forwarder has to surrender OBL to carrier along with release letter requesting carrier to issue DO to a named consignee. Correct me if am wrong in my understanding

    Ramana Murthy R S V
    India

  12. By Yusuf Reply

    I look forward to your discussion on abandoned shipments, especially in the South African context 🙂

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