FOB, or Free On Board, is an Incoterms 2020 rule for sea and inland waterway transport. The seller delivers when the goods are on board the vessel nominated by the buyer at the named port of shipment, where risk transfers under the rule.
Quick reference for FOB
| Check | What it means for the transaction |
|---|---|
| Category | Trade and logistics |
| Record to keep | Keep the agreed term, named place, shipment reference, carrier event, cost allocation and delivery evidence when they apply. |
| Do not infer | A delivery term does not settle payment timing, transfer of title or regulatory responsibility unless the contract says so. |
FOB and nearby terms
- Incoterms: Incoterms are eleven standardized trade terms published by the International Chamber of Commerce for contracts involving the sale of goods.
- Landed cost: Landed cost is the total cost of obtaining a product and bringing it to the required location.
