An air waybill (AWB) is like a passport for goods travelling by an international air courier. It’s a crucial document that contains all the necessary details about the shipment and enables easy tracking throughout its journey. Each party involved in the shipment gets a copy of the bill to keep records.
Think of an AWB as a ticket for your package, ensuring it reaches its destination smoothly. While it shares similarities with ocean bills of lading, it’s worth noting that an AWB doesn’t offer as much protection since it’s issued in a non-negotiable form.
What is an Air Waybill?
An air waybill (AWB) plays a crucial role in air freight, serving as both a receipt and a contract between the shipper and the airline (the carrier). This document is legally binding, ensuring that both parties fulfil their obligations. It becomes a valid contract once it’s signed by the shipper (or their representative) and the carrier (or their representative).
The AWB includes essential details such as the shipper’s and consignee’s names and addresses, the origin and destination airport codes, declared value for customs, quantity and weight of the goods, a description of the items being shipped, and any special instructions, such as if the goods are perishable.
Moreover, the AWB outlines the terms and conditions of the carrier, including their liability limits, procedures for filing claims, and any applicable charges. It essentially provides a clear understanding of the agreement between the shipper and the airline, ensuring a smooth and legally sound transportation process.
What is the Function of an Air Waybill?
This concise legal document carries significant information vital for both local and global shipping operations. Here’s how it serves various functions:
- It serves as a formal agreement between the sender and the airline, outlining the terms of transportation.
- This document serves as tangible evidence that a shipment has been made.
- It functions as the official invoice for air freight services rendered.
- It serves as a legally binding document containing pertinent details about all involved parties.
- It assists the carrier in ensuring the accurate dispatch of the shipment.
- Additionally, it doubles as a declaration form for customs purposes.
What are the Different Types of Air Waybill?
Air Waybills come in two main types:
House Air Waybill (HAWB)
When exporters hand over their goods to a freight forwarder, the forwarder issues them a House Air Waybill. This document identifies the exporter as the shipper and the importer as the consignee.
Master Air Waybill (MAWB)
After customs clearance and when the cargo is handed over to the primary carrier, a Master Air Waybill is issued to the freight forwarder. Here, the forwarder is listed as the shipper, and the person receiving the shipment at the destination port before the consignee is referred to as the consignee. This individual then handles the final delivery of the goods.
What is the Format of an Air Waybill?
The International Air Transport Association (IATA) has set standards for two main formats of Air Waybills:
Airline-specific AWB
This type includes details such as the airline’s name, logo, headquarters address, and the Air Waybill number.
Neutral AWB
Similar to the airline-specific format but excludes airline-specific details.
Air Waybills are issued in 8 different colour codes, each serving a specific purpose:
- Green: The original copy retained by the carrier (issuing authority).
- Pink: Another original copy kept by the consignee of the shipment.
- Blue: An original copy was given to the shipper.
- Brown: A duplicate used as a receipt or proof of delivery.
- White: Another copy retained by the shipper for various purposes.
Each Air Waybill is assigned a unique 11-digit number, which provides specific information:
- The first three digits identify the carrier.
- The following seven digits represent the serial number of the bill.
- The last digit is a checksum calculated by dividing the serial number digits by 7.
How to Issue an Air Waybill?
The process of applying and issuing an Air Waybill (AWB) involves several steps:
- The carrier is responsible for transporting the air shipment and issues an Air Waybill once the goods have cleared customs formalities.
- The shipper receives the Air Waybill and, if the transaction is conducted under a Letter of Credit, sends it through their bank to the consignee.
- Upon arrival at the destination, the consignee or their agent receives the shipment and obtains a copy of the Air Waybill.
In the past, issuing an AWB involved a lot of paperwork and manual effort. However, in 2010, the International Air Transport Association (IATA) introduced the electronic Air Waybill (e-AWB) to streamline the process. Since January 1st, 2019, the e-AWB has become the default contract of carriage for air cargo shipments, replacing the traditional paper-based system.
Difference Between Air Waybill and Bill of Lading
Air waybills (AWBs) differ from other bills of lading in several key ways. Unlike bills of lading, AWBs are non-negotiable, meaning they don’t specify which flight will carry the shipment or when it will arrive at its destination.
Bills of lading are legal documents that outline the agreement between the shipper and the carrier regarding the type, quantity, and destination of the goods being transported. They also serve as proof of shipment upon delivery at the agreed-upon destination. These documents are signed by authorized representatives of the shipper, carrier, and recipient.
However, an AWB, while still serving as a contract for transportation, is not negotiable and doesn’t cover the value of the merchandise being transported. It simply facilitates the logistics of getting the goods from one point to another.
The Bottom Line
When you’re sending goods overseas, an air waybill acts like a contract between you and the carrier. It lays out what’s being shipped, where it’s coming from, where it’s going, and other important info.
Since 2019, it’s mostly electronic. This document is fixed and can’t be changed. Both parties sign off on it, and it holds legal weight. For more detailed information about AWB and to ensure you comply with all export obligations, you can hire a DGFT Consultant to ease your export documentation process.
