Introduction to Free on Board
Free on Board (FOB) is a legal term used in international trading that indicates who is responsible for the transportation costs associated with the goods being shipped. It is frequently used when goods are sold and shipped from one country to another. It is important to understand the implications of FOB when buying and selling goods in the international market.
Understanding “Free on Board”
The term FOB is usually used in international shipping agreements to designate who is responsible for the cost of shipping goods. It is usually included in the purchase order, sales contract, or other shipping documents. It is important to understand the implications of this term when trading internationally. When the term FOB is used, it indicates which party (the seller or the buyer) is responsible for the cost of shipping the goods. The terms FOB Buyer and FOB Seller can be used to indicate who is responsible for the cost of shipping.
- FOB Buyer – The buyer is responsible for the cost of shipping the goods from the seller’s location to the buyer’s destination.
- FOB Seller – The seller is responsible for the cost of shipping the goods from the seller’s location to the buyer’s destination.
The FOB term also indicates when ownership of the goods is transferred. The terms FOB Origin and FOB Destination can be used to indicate when ownership of the goods is transferred.
- FOB Origin – Ownership of the goods is transferred when the goods are shipped from the seller’s location.
- FOB Destination – Ownership of the goods is transferred when the goods are delivered to the buyer’s destination.
Conclusion
Free on Board (FOB) is an important term to understand when trading internationally. It indicates who is responsible for the cost of shipping the goods and when ownership of the goods is transferred. It is important to understand the implications of FOB when buying and selling goods in the international market. For more information about Free on Board, please see the following links: