Cost and FreightCFR
When the goods are on board the vessel at the port of shipment — earlier than the destination the seller pays freight to.
CFR (Cost and Freight) is an Incoterms® 2020 rule for sea and inland waterway transport only, in group C. The seller contracts and pays for the carriage to the named port of destination, but delivery — and the transfer of risk — happens earlier, when the goods are on board the vessel at the port of shipment.
This is the defining C-group split: the seller pays the freight to the destination port, yet risk passes to the buyer at origin, once the goods are on board. The seller clears the goods for export; the rule does not require insurance; the buyer is responsible for import clearance, duties and costs arising at the destination port beyond the agreed carriage.
CIF is the same rule as CFR with the addition that the seller must also provide cargo insurance.
Cost & risk along the journey
Who is responsible
Turkey delivery code
Same group
Frequently asked questions
- QWhat does CFR mean in Incoterms 2020?
- ACFR stands for Cost and Freight. The seller pays the freight to the named destination port, but risk transfers to the buyer earlier, when the goods are on board the vessel at the port of shipment.
- QWhen does risk transfer under CFR?
- ARisk transfers when the goods are on board the vessel at the port of shipment, even though the seller pays the freight to the destination port.
- QWho pays for the main carriage under CFR?
- AThe seller contracts and pays for the carriage to the named port of destination.
- QIs insurance required under CFR?
- ANo. CFR does not require insurance. Because risk passes at origin while the seller pays freight to destination, the buyer may wish to arrange its own cover.
- QWho clears the goods for import under CFR?
- AThe buyer handles import clearance and duties; the seller clears the goods for export.
- QWhich transport modes can CFR be used for?
- ACFR is for sea and inland waterway transport only.
- QWhat is the difference between CFR and CIF?
- ACIF is CFR plus insurance: under CIF the seller must also provide minimum cargo insurance to the destination port, while under CFR no insurance is required.
Incoterms® is a registered trademark of the International Chamber of Commerce (ICC) and the official rules are copyright ICC. This is a factual reference in logibook's own words — not the ICC rules; always rely on the official ICC Incoterms® 2020 text for the binding rules.