||Free Carrier (Named point)
||Free Alongside Ship
||Free On Board
||Cost & Freight
||Cost, Insurance & Freight
||Carriage Paid To (Named place)
||Carriage, Insurance Paid To (Named place)
||Delivered At Frontier (Named place)
||Delivered Duty Unpaid (Named place)
||Delivered Duty Paid
A) It is the seller's primary duty to deliver the goods on board
the vessel named by the buyer at the named port of shipment on the date
or within the period stipulated and in the manner customary at the port.
the reference "the manner customary as the port" highlights
the problem of using the passing of the ship's rail as the guiding factor
in practice. The parties in these circumstances will have to follow the
custom of the port regarding the actual measures to be taken in delivering
the goods onboard. Usually the task is performed by stevedoring companies,
and the practical problem normally lies in deciding who should bear the
costs of their services.
B) Special agreement to be made to establish who is responsible for
'trimming' or 'lashing and securing'.
C) Special agreement to be made to establish who actually is to
pay import duty and/or other import taxes.
NB: Whilst every effort has been made to ensure the accuracy of
information contained in this diagram, no responsiblity for errors or
omissions can be accepted by ILCS.
Sellers only responsibility is to make goods available at their
premises. No responsibility for loading goods on buyers vehicle
or clearing them for export unless agreed with buyer. Buyer bears
full cost and risk of taking goods from sellers works to destination.
This is the minimum obligation of seller.
FCA Free Carrier (named point)
Used with any form of transport, ie, air, sea, road, rail etc. Similar
to FOB except seller fulfils obligations by delivering into the custody
of the carrier at named point. Seller must hand goods, cleared for
export, over to carrier at point nominated in the shipping terms.
Where delivery takes place at sellers premises, seller is responsible
FAS Free Alongside Ship
Properly used only for ocean or inland water transport. Seller responsible
for placing goods alongside ship on the quay or in lighters at nominated
port. Buyer bears all costs abd risks of loss or damage to goods from
this point. Unlike FOB, FAS requires buyer to clear goods for export.
FOB Free On Board
Properly used only for ocean or inland water transport (but commonly
used for airfreight as well). Seller required to place goods on board
ship at nominated port in contract. Buyer assumes risk of loss/damage
to the goods once they pass ships rail. In other modes of transport,
or if ships rails are not point at which seller transfers ownership
to buyer, ie, with container or roll-on/roll-off cargo-FCA is closest
CFR (C&F) Cost & Freight
Seller must clear goods for export and pay costs and freight to bring
goods to nominated destination in sales contract. Buyer assumes risk
of loss or damage, along with any cost increases, once goods pass
ships rail in port of shipment. Another term properly used only for
transport by water (sea or inland). CPT (Carriage Paid To) is closest
equivalent for non transport by water shipments.
CIF Cost, Insurance & Freight
Similar to CFR except seller must insure goods against risk of loss
or damage during transit. Also applies only to transport by water
(sea or inland). CIP (Carriage, Insurance Paid To) is closest equivalent
term for other modes of transport.
CPT Carriage Paid To (Named place)
Can be used with any form of transport, ie, air, sea, road, rail.
Seller must clear goods for export and pay costs and freight necessary
to carry to named destination. Buyer assumes risk of loss or damage
to goods, plus any cost increases, once first carrier has received
CIP Carriage, Insurance Paid To (Named place)
As per CPT except seller must pay insurance.
DAF Delivered At Frontier (Named place)
Term designed for rail or road transport but can be used when goods
shipped by any method. (Useful when shipping to bonded Customs Warehouse
or Free Trade Zone). Seller fulfils obligations once goods, cleared
for export, are made available at named point, which will be before
destination Customs border. Buyer must clear goods through Customs.
DES Delivered Ex-Ship
Term normally used for commodity shipments by sea. Buyer assumes
risks and costs once ship reaches named destination, but before goods
cleared for import.
DEQ Delivered Ex-Quay
Also normally used for commodity shipments by sea. Buyer assumes
risk and costs on quay at named destination. Seller responsible for
discharge costs. Buyer responsible for import clearance.
DDU Delivered Duty Unpaid (Named place)
Seller handles everything necessary to deliver goods to nominated
point (usually buyers premises) except Customs clearance at destination
country. Buyer pays duties/taxes.
DDP Delivered Duty Paid (Named place)
Same as DDU except for fact that seller is responsible for Customs
clearance and seller is responsible for payment of duties/taxes. Common
alternative is DDP exclusive of duties/taxes whereby shipper
pays for clearance but not for paying duties/taxes.