Free On BoardFOB
When the goods are on board the vessel at the named port of shipment.
FOB (Free On Board) is an Incoterms® 2020 rule for sea and inland waterway transport only, in group F. The seller delivers the goods, cleared for export, by placing them on board the vessel nominated by the buyer at the named port of shipment.
Risk and cost transfer to the buyer when the goods are on board the vessel. From that point the buyer arranges and pays for the main carriage and is responsible for import clearance and duties. The seller clears the goods for export; the rule does not require insurance.
FOB applies to goods loaded on board a vessel; for containerised goods handed over to the carrier at a terminal before loading, FCA is the corresponding rule, because risk would otherwise pass while the goods are still in the seller's control at the terminal.
Cost & risk along the journey
Who is responsible
Turkey delivery code
Same group
Frequently asked questions
- QWhat does FOB mean in Incoterms 2020?
- AFOB stands for Free On Board. The seller delivers the goods on board the vessel nominated by the buyer at the named port of shipment, cleared for export, and the buyer arranges the main carriage.
- QWhen does risk transfer under FOB?
- ARisk transfers when the goods are on board the vessel at the named port of shipment.
- QWho pays for the main carriage under FOB?
- AThe buyer contracts and pays for the main carriage. The seller's responsibility ends once the goods are on board.
- QWho clears the goods for export under FOB?
- AThe seller clears the goods for export; the buyer handles import clearance and duties.
- QIs insurance required under FOB?
- ANo. FOB does not require either party to insure the goods; the buyer bears the risk during the main carriage.
- QWhich transport modes can FOB be used for?
- AFOB is for sea and inland waterway transport only.
- QWhat is the difference between FOB and CIF?
- AUnder FOB the buyer arranges and pays the main carriage and insurance; under CIF the seller pays the freight and minimum insurance to the destination port, though risk still passes when the goods are on board at origin.
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.