What is the meaning of FOB in Incoterms?

Free on Board
Under the terms of FOB (short for “Free on Board”), the seller clears the goods for export and ensures they are delivered to and loaded onto the vessel for transport at the named port of departure.

What does FOB and EXW mean?

What Do EXW and FOB Stand for? EXW stands for Ex Works, an incoterm whereby the buyer of a shipped product pays for the goods when they are delivered to a specified location. FOB, or Free on Board, instead shifts the responsibility of the goods to the buyer as soon as they are loaded onboard the ship.

How do you use FOB Incoterms?

When goods are bought or sold “Free on Board” (FOB) it means that the seller delivers the goods to a ship at a port previously agreed to by the seller and the buyer. The seller loads the goods onto the ship. The buyer then takes care of the import formalities and transportation to the final destination.

Does FOB include packaging?

Your goods are packaged and loaded onto a truck (or another form of transportation) at the supplier’s warehouse (or another facility). The truck brings the goods to the port. The goods are loaded on board the shipping vessel.

Does FOB include customs duty?

FOB shipping point means the ownership of the product is transferred to the buyer from the point it leaves the seller’s place. Both delivery and custom inspection are the responsibility of the buyer.

Can you use Incoterms for domestic shipments?

And well, the answer is: yes, you can use the 11 official Incoterms 2020 also for domestic transactions. You can even use the Incoterms 2010 or older versions if your business partner agrees to use them.

Who pays shipping on FOB origin?

“FOB shipping point” or “FOB origin” means the buyer is at risk once the seller ships the product. The purchaser pays the shipping cost from the factory and is responsible if the goods are damaged while in transit.