FOB (Free On Board)

FOB (Free On Board)

FOB (Free On Board) is a term that is commonly used in international trade when the seller delivers the goods to a specified location on board a ship. The seller is responsible for loading the goods onto the ship and delivering them to the specified location, but the buyer is responsible for paying for and arranging the transportation of the goods to their final destination.

Here is an example of how FOB (Free On Board) might be used in a contract:

Seller: ABC Company

Buyer: XYZ Corporation

Goods: 100 units of widget A

Price: $10 per unit

Terms: FOB (Free On Board)

Under these terms, the seller will deliver the goods to a designated location on board a ship at the port in Country X. The buyer is responsible for arranging and paying for the transportation of the goods from the designated location to their final destination in Country Y. The seller is not responsible for any delays or damages that may occur during transportation.

In this example, the seller's responsibility is limited to delivering the goods to a designated location on board a ship at the port. The buyer is responsible for everything else, including arranging and paying for transportation, customs clearance, and any other costs associated with getting the goods to their final destination.