What is the difference between fob and fca

These acronyms define terms of trade including shipping and freight details to prevent any dispute later on. Two of these contracts, namely FOB and FCA, are confusing for both buyers as well as sellers because of their similarities. FOB that stands for Free on Board is a very popular mode of contract between buyers and sellers.

The main provision of FOB pertains to seller taking the responsibility of loading the goods on to the vessel that has been chosen by the buyer. However, this responsibility ceases as soon as goods have been loaded on to the vessel, and all the risk is transferred on to the buyer.

FOB applies only to maritime trade and should not be misconstrued to FCA, which is applicable to trade by road, rail, air, as well as sea. Do you have different thought on FCA vs.. How is IGST rate on imports treated? How to export goods from India? Export benefit schemes in India. Export procedures and documentation. How to get Export Order? How to import goods to India? Find ITC code of your product.

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Is Airway bill a documents of title? All good until here. This is a given fact, but it is spelled out concisely just to avoid ambiguities. Any further documentation that would assist the deliverance of the cargo must be provided by the seller. This is the case provided that the requirements are spelled out before executing the delivery order. Those documents that we are referring to are non-exhaustively listed below: —. If the buyer does not specify clearly the delivery location, the seller has the right to choose the delivery location.

The shipment can proceed as an FCA term. According to the ICC handbook, the seller is responsible for any cost incurred to deliver the cargo to a named destination, if the destination happens to be a seaport or an airport. The seller is responsible for all port-related fees incurred at the port of loading, including Terminal Handling Charges.

Whether it is Air Freight, Sea Freight, Rail Freight, or Multimodal Transportation, the buyer is responsible for the freight arrangement, along with the terminal handling costs at the Port of Discharge. The Buyer is also responsible for the cost of any document preparation from all stages of delivery, including the Bill of lading fees, telex release fees, EDI fees, and other miscellaneous charges.

ICC clearly states that the buyer should purchase any form of insurance from when the transportation risk has been transferred. Hence, for this instance, should the buyer choose to purchase insurance for the freight voyage, they are accountable for those charges. Every responsibility of the buyer and the seller are similar for both FCA and FOB apart from one detail — the named delivery location.

As the name suggests, the seller is responsible for the cargo delivery up until the cargo is fully loaded onto the vessel.