Define the shipping term FOB in detail.

FOB - Free On Board (Port of Shipment)


If terms of delivery of a transaction are on FOB means, the cost of movement of goods on board of ship nominated by the buyer at the named port of shipment is borne by the seller. Rest of all expenses to arrive the goods at buyer's premise must be met by the buyer. If both parties do not consent to have goods delivered on board, then FCA is the term to be used.

FOB suits better for bulk cargo and not containerized cargo. For containerized cargo use FCA is the most prescribed term to use.

This term can be used for Sea and Inland water transport only.


Obligation and expenses of seller:-

All responsibilities and charges should incur by seller include Warehouse Services, Export packing, assistance in obtaining any exports licence or other official authorisation, loading at point of Origin, Origin Inland Freight, Origin Port Charges, Export Customs clearance, Origin Forwarder Fees.

The risk passes to the buyer from the seller when the goods are on board the vessel.


Obligation and expenses of Buyer:-

All responsibilities and charges must incurs by Buyer includes Ocean/Air Freight, Destination Port Charges, Import Customs clearance , Import Duties and Taxes, Delivery cartage to Final Destination.




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