What is an Airway Bill and It’s Importance in Airfreight Logistics
Just like a Bill of Lading for sea freight, an Airway bill is one of the most important documents in airfreight logistics. As important as it is, issues of clarity, hidden detail, and the legality of an Airway bill are prevalent. They can be confusing to even shippers who either have limited knowledge or fail to pay attention to the hidden detail. The focus of this article is to briefly explain the key components of an Air waybill and six key reasons it is regarded as a principal document in airfreight logistics.
What is An Airway bill?
An airway bill is a document of receipt issued by an airline or its authorized agent. It shows that there is a contract of carriage between an airline and the sender of cargo for the transportation of cargo from the origin (sender’s airport) to the receiver’s airport or designated location.
An Airway bill is a straight, non-negotiable document that contains 11 digits, with a detailed description of cargo. Other important information contained on an airway bill is the name and address of the sender, place and address of the owner of the cargo, the type, quantity, and weight of the cargo, place of loading, date of loading, transportation cost, place and date of its payment and the declared value of cargo.
Beyond serving as a mandatory document for airfreight logistics, the Airway bill is important for the following six major reasons:
Contract of Carriage: It represents a contract of carriage because it defines the terms and conditions of transportation of goods from the origin to the destination airport. In other words, an Airway bill represents the airline’s obligation to transport the goods to the specified destination, under the agreed conditions, in exchange for a specific sum of money. Also, the contract of carriage contains the name of the recipient entitled to the right to claim the consignment at the destination.
Evidence of Cargo Receipt: It serves as evidence for the receipt of cargo, showing that goods were delivered to the designated recipient in good condition. This can also serve as legal evidence in case a dispute regarding the condition of the shipment comes up.
Freight Invoice: It provides information on the freight charges to be paid by the consignee. In other words, when paired with other supporting documents, an airway bill can be used as a bill or invoice indicating the charges to be paid by the consignee and charges due to the agent or the carrier.
Insurance Certificate: An Airway bill can also serve as a certificate of insurance. This is so because since the Airway Bill is legal evidence that the carrier has received the goods in good condition, it can also be used by the carrier to insure the goods, especially if requested by the supplier of the goods.
Customs Declaration: It facilitates customs declaration. It is a legal document that includes a comprehensive detail of the airfreight; recognized by Customs for the clearance and release of cargo in line with Customs clearance guidelines.
Cargo Tracking: For cargo visibility, the Airway bill can be used to track the movement of cargo from origin to destination. This can be done by inputting the Airway bill number on the designated tracking menu on the carrier’s (airline) website, and information on the location or status of the shipment will be displayed. (how to track your cargo)
Just like a Bill of Lading, a single article may not be enough to explore every dimension of an Airwaybill; the goal of this article is to briefly examine its fundamental importance in the airfreight forwarding and logistics industry. The next article will explore the various nomenclatures, features, formats, and significance of the 11-digit numbers on an airway bill.