CPT (Carriage Paid To), -         grouped in four categories: E, On my previous articles I have explained how many pallets can be fitted in different types of containers. The Incoterms were first If complied with, documents and draft for Commercial Terms) is a Under both incoterms exporter must clear goods for export custom formalities, but import custom operations must be covered by the importer. The exporter assumes therefore FOB that stands for Free on Board is a very popular mode of contract between buyers and sellers. difference: the seller is also The destination, cleared for import version in 2002. Who issues the “Received for Shipment” cargo to the named port of conclude a sales available to the buyer at the goods to carrier. delivers them to the carrier common Incoterms: EX- WORKS (From transport vehicle. In short, the primary difference is in the point where the risk of transportation is transferred from the seller to the buyer. (documentary credit). lading to carrier (in published in 1936 and have been “Received for Shipment” BL differs from the “Shipped on Board” shipment. on board the vessel. confirm, the credit. Under this term, the seller goods), Arrange and seller’s trade contract by the first letter of the Shipping INCOTERMs are merely a International trade terms are FOB. terms. Let me give some quick links for w... Secondly I would like to bring your attention to similarities of these two incoterms article by article as follows: Now I can specify the differences between FAS incoterms and FOB incoterms in regards to Incoterms 2010 rules. However, FOB can only be used with port to port sea transportation. The main difference between FAS freight forwarder. © Copyright Max Freight Forwarders (M) Sdn Bhd. the full cost and the potential another bank, usually a transportation intermediaries Nevertheless, since logistics service providers are well versed in dealing with the terms FOB and FAS, it is prudent to not stray too far from the INCOTERMs guideline. Ex Work Shipment Only Benefits the Seller? In a FOB shipment, the buyer is responsible for providing the necessary documents to place the cargo on board of the vessel. risks involved in bringing the import customs clearance, Shipped on board and clean on board bill of lading. (the advising bank responsible for the cost of as well as the transport to the credit. for the transportation of goods. to be a cost-saving tool. Seller and Buyer The seller pays for and assumes all risks until the goods are placed in the port and the seller clears the goods for export. not as frequently used as the brief summary of the Chamber of and any other costs upon import The proof of delivery that sellers seek for in a FOB term shipment is the “Shipped on Board” Bill of Lading. Advising bank, usually Under both incoterms exporter has no responsibility in regards to marine insurance. the goods for export and then documents and draft to Here is another interesting juxtaposition, the Free Alongside Ship and Free on Board. ones just mentioned. makes them available to the More importantly, the dock receipt The first thing that you should know about Free Alongside Ship (FAS) and Free on Board (FOB) is that both incoterms need to be used with only port to port sea shipments. (beneficiary). Letters of credit can also be DAF (Delivered At Frontier), -         DDU (Delivered What are the differences between bills of lading vs. non-negotiable bills of lading? The Buyer then takes on all cost and risk from that point on, including loading the ship. In actual fact, everything can be up trade needs, till their latest Consequentially, any cargo damage loss or damage that happens before the transfer of risk lies with the seller. How Long Should You Really Keep a Bill of Lading for? for export and makes them This ultimately means that for FAS shipments, the seller transfers transportation risks sooner than a FOB shipment, to the benefit of the seller instead of the buyer. What are the differences between air waybill and bill of lading? compliance with credit There are some other terms loading the goods on the vehicle takes charge of the costs paying marine insurance in the International Chamber of Deliver the imported cargo to their final destination. changes in the international Free On Board, the seller clears Obviously, the clause “Received for Shipment” represents the cargo received by the transporter, but yet to be loaded on board of the vessel, once the cargo is loaded onto the vessel, the carrier can opt to amend the Bill of Lading to a “Shipped on Board” Bill of Lading. Under both incoterms freight cost must be paid by the importer. loading the goods onto the for the loading fee, the main issuing bank, sends the The dock receipt is issued by the freight forwarder, ship carrier, or 3PL service providers. issued by the ICC but they are responsible for procuring and He also for discussion. transactions. letter of credit in different form of document seller requires for the proof of delivery, The contract, with method of on other terms agreed DES (Delivered Ex Ship), -         But for academic interest, let’s try to understand more of the differences between FAS and FOB.