What are the applicable NAIC requirement for consolidation and co‑loading scenarios, including who files which bills and how delegation works?

What are the applicable NAIC requirement for consolidation and co‑loading scenarios, including who files which bills and how delegation works?

Consolidation and Co-loading
Consolidation and Co-loading are standard industry practices involving the handling of shipments from multiple parties under a single consignment.

NAIC Requirements Overview
To ensure full visibility and traceability, NAIC requires the submission of all bills of lading issued throughout the shipping process in consolidation and co-loading scenarios. This includes bills of lading issued by shipping lines and freight forwarders acting as master co-loaders or sub coloaders. Freight forwarders may also be allowed to submit filings on behalf of other freight forwarders within the hierarchy. 

The below illustrates a multi-layer shipping scenario to demonstrate NAIC requirements.
  1. A shipping line transports cargo for an NVOCC (master co-loader) and issues the master bill of lading BL 1.
  2. The NVOCC consolidates shipments from a shipper and a freight forwarder. It issues BL 1.1 which acts as a house bill in relation to the shipping line and as a master bill in relation to the freight forwarder. It also issues house bill BL 1.2 for shipper A.
  3. The freight forwarder (house co-loader) further consolidates shipments from two additional shippers, and issues corresponding house bills BL 1.1.1 and BL 1.1.2.
Shipping Line Filing
The shipping line is required to submit the shipping line bill of lading ‘BL 1’. The bill must include the MPCI Party ID for the NVOCC, who is responsible for submitting the next layer of house bills of lading. 6.1.3 Freight Forwarder Filing In the illustrated example, normally each of the NVOCC (master co-loader) and the freight forwarder (sub co-loader) is responsible for submitting the bills of lading they issue. However, for flexibility, NAIC also provides options for delegation. 

Freight Forwarder Filing
Normally each of the NVOCC (master co-loader) and the freight forwarder (sub co-loader) is responsible for submitting the bills of lading they issue. However, for flexibility, NAIC also provides options for delegation.

Normal Filing Scenario
In the normal filing scenario, each entity submits the bills of lading they issue.
NVOCC:
  1. Files ‘BL 1.1’ as a consolidated bill, indicating that child bills ‘BL 1.1.1’ and ‘BL 1.1.2’ will follow. The NVOCC provides the freight forwarder MPCI Party ID as the expected filer for these child bills.
  2. Files ‘BL 1.2’ as a non-consolidation bill, indicating that no further child bills will be filed.
  3. References the shipping line’s bill of lading ‘BL 1’ as the parent bill in both filings and specifies the shipping line’s MPCI Party ID as the expected filer for it.
Freight Forwarder:
  1. Files ‘BL 1.1.1’ and ‘BL 1.1.2’ as non-consolidation bills, indicating that no further child bills will be filed.
  2. References the NVOCC’s bill of lading ‘BL 1.1’ as the parent bill in both filings and specifies the NVOCC’s MPCI Party ID as the expected filer for it. 
Delegation Options
For flexibility, NAIC allows delegation of filing responsibilities under the following conditions:


NVOCC Files on Behalf of the Freight Forwarder:
  1. The NVOCC files ‘BL 1.1.1’ and ‘BL 1.1.2’ on behalf of the freight forwarder.
  2. While filing, the NVOCC indicates it is filing on behalf of the freight forwarder by specifying the freight forwarder MPCI Party ID as the issuer of these bills.
Freight Forwarder Files on Behalf of the NVOCC:
  1. The freight forwarder files ’BL 1.1’ on behalf of the NVOCC.
  2. While filing, the freight forwarder indicates it is filing on behalf of the NVOCC by setting the MPCI party ID of the NVOCC as the issuer of this bill.