FOB-Free on Board-(named port of shipment)

 

"Free on Board" means that the seller fulfils his obligation to deliver when the goods have passed over the ship's rail at the named port of shipment. This means that the buyer has to bear all costs and risks of loss of or damage to the goods from that point.

The FOB term requires the seller to clear the goods for export.

This term can only be used for sea or inland waterway transport. When the ship's rail serves no-practical purpose. such as in the case of roll-on/roll off or container traffic the FCA term is more appropriate to use.

A. The seller must

A.1. Provision of goods in conformity with the contract

Provide the goods and the commercial invoice, or its equivalent electronic message, in conformity with the contract of sale and any other evidence of conformity which may be required by the contract.

A.2. Licences, authorisation and formalities


Obtain at his own risk and expense any export licence or other official authorisation and carry out all customs formalities necessary for the exportation of the goods.

A.3. Contract of carriage and insurance

a) Contract of carriage

No obligation.

b) Contract of insurance

No obligation.

A.4. Delivery

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.

A.5. Transfer of risks

Subject to the provisions of B.5., bear all risks of loss of or damage to the goods until such time as they have passed the ship's rail at the named port of shipment.

A.6. Division of Costs

Subject to the provisions of B.6.

- pay all costs relating to the goods until such time as they have passed the ship's rail at the named port of shipment;

- pay the costs of customs formalities necessary for exportation as well as duties, taxes and other official charges payable upon exportation.

A.7. Notice to the buyer

Give the buyer sufficient notice that the goods have been delivered on board.

A.8. Proof of delivery, transport document or equivalent electronic message

Provide the buyer at the seller's expense with the usual document in proof of delivery in accordance with A.4.

Unless the document referred to in the preceding paragraph is the transport document render the buyer, at the latter's request, risk and expense, every assistance in obtaining a transport document for the contract of carriage (for example, a negotiable bill of lading, a non-negotiable sea waybill, an inland waterway document, or a multimodal transport document).

Where the seller and the buyer have agreed to communicate electronically, the document referred to in the preceding paragraph may be replaced by an equivalent electronic data interchange(EDI) message.

A.9. Checking-packaging-marking


Pay the costs of those checking operations (such as checking quality, measuring, weighing, counting) which are necessary for the purpose of delivering the goods in accordance with A.4.

Provide at his own expense packaging (unless it is usual for the particular trade to ship the goods of the contract description unpacked) which is required for the transport of the goods, to the extent that the circumstances relating to the transport (e.g. modalities, destination) are made known to the seller before the contract of sale is concluded.

Packaging is to be marked appropriately.

A.10. Other obligations

Render the buyer at the latter's request, risk and expense, every assistance in obtaining any documents or equivalent electronic messages (other than those mentioned in A..8.) issued or transmitted in the country of shipment and/or of origin which the buyer they require for the. importation of the goods and, where necessary, for their transit through another country.

Provide the buyer, upon request, with the necessary information for procuring insurance.

B. The buyer must

B.1. Payment of the price

Pay the price as provided in the contract of sale.

B.2. Licences, authorisations and formalities


Obtain at his own risk and expense any import licence or other official arthorisation and carry out all customs formalities for the importation of the goods and, where necessary. for their transit through another country.

B.3. Contract of carriage

Contract at his own expense for the carriage of the goods from the named port of shipment.

B.4. Taking Delivery

Take delivery of the goods in accordance with A.4.

B.5. Transfer of risks

Bear all risks of loss of or damage to the goods from the time they have passed the ship's rail at the named port of shipment.

Should he fail to give notice in accordance with B.7., or should the vessel named by him fail to arrive on time, or be unable to take the goods, or close for cargo earlier than the stipulated time, bear all risks of loss of or damage to the goods from the agreed date or the expiry date of the period stipulated for delivery provided, however, that the goods have been duly appropriated to the contract, that is to say, clearly set aside or otherwise identified as the contract goods.

B.6. Division of costs

Pay all costs relating to the goods from the time they have passed the ship's rail at the named port of shipment.

Pay any additional costs incurred, either because the vessel named by him has failed to arrive on time, or is unable to take the goods, or will close for cargo earlier than the stipulated date, or because the buyer has failed to give appropriate notice in accordance with B.7. provided, however, that the goods have been duly appropriated to the contract, that is to say, clearly set aside or otherwise identified as the contract goods.

Pay all duties, taxes and other official charges as well as the costs of carrying out customs formalities payable upon importation of the goods and, where necessary, for their transit through another country.

B.7. Notice to the seller

Give the seller sufficient notice of the vessel name, loading point and required delivery time.

B.8. Proof of delivery, transport document or equivalent electronic message

Accept the proof of delivery in accordance with A.8.

B.9. Inspection of goods


Pay, unless otherwise agreed, the costs of pre-shipment inspection except when mandated by the authorities of the country of export.

B.10. Other obligations

Pay all costs and charges incurred in obtaining the documents or equivalent electronic messages mentioned in A.10. and reimburse those incurred by the seller in rendering his assistance in accordance therewith.