FOB ( Eng. Free On Board - free on board, literally - free on board) - the international trade term Incoterms , used to indicate the conditions of delivery of goods and determine the party that is responsible for the transportation costs and / or determine the point of transfer of responsibility for the goods from seller to buyer.
Terms
FOB conditions stipulate that the seller is obliged to deliver the goods to the port and load onto the vessel indicated by the buyer; The cost of delivering the goods on board the vessel is borne by the seller. In some ports, for delivery on FOB terms, the cost of loading is borne by the buyer. The risk of accidental loss of property or damage to it lies with the seller - until the goods cross the side of the vessel, and the buyer - from the indicated moment.
Incoterms
According to Incoterms standards, FOB means “goods are loaded onto a customer’s ship”. An indication of the FOB terms in the contract means that the seller pays for the delivery of the goods until loading, plus the loading on board itself. He also has the responsibility to clear the goods from duties (for export). The buyer pays for transportation, insurance, unloading and transportation costs to the destination. Risk transfer occurs when the cargo crosses the side of the ship. Typically, the FOB also indicates the port of loading; for example, "FOB port Odessa."
When the parties agree on a specific version of Incoterms, this is also indicated in the contract; for example, "FOB port of Odessa (Incoterms 2000)."
If the parties do not intend to move the goods overboard, the term FCA should be used.