How do freight forwarders differ from carriers in terms of liability and responsibilities?

• A. Carriers issue Bills of Lading and bear direct liability for carriage; freight forwarders arrange transport, may issue house B/Ls (NVOCC), and often have pass-through liability depending on contracts.
• B. Freight forwarders arrange transport, may issue house B/Ls (NVOCC), and often have pass-through liability depending on contracts.
• C. Carriers issue Bills of Lading and bear direct liability for carriage; freight forwarders arrange transport.
• D. Freight forwarders are never liable and do not issue B/Ls.

Answer: (B)

The key idea is who bears direct responsibility for the cargo and who coordinates move-by-move logistics. Carriers are the entities that physically move goods and issue the master bill of lading; they bear direct liability for the carriage under the contract of carriage and applicable laws.

Freight forwarders, on the other hand, are logistics arrangers. They organize and oversee the transport, often coordinating multiple carriers. When they issue a document, it’s usually a house bill of lading if they act as an NVOCC, creating a contract with the shipper that sits on top of the carrier’s contract. Because of that structure, the forwarder’s liability to the shipper is typically pass-through and defined by their contract. They may be liable for issues arising from their own actions, but they don’t have the same direct liability for the carriage as the carrier.

So the correct idea is that freight forwarders arrange transport, may issue house B/Ls (NVOCC), and have pass-through liability depending on contracts, while carriers issue the master B/L and bear direct liability for the carriage.