Term | Definition | Risk | Cost |
EXW
Ex Works | Buyer arranges for pick up of goods at the seller's location. Seller is
responsible for packing, labeling, and preparing goods for shipment
on a specified date or time frame. | Buyer assumes all risk. | Buyer pays all transportation costs. |
FCA
Free Carrier | Seller is responsible for costs until the buyer's named freight carrier
takes charge. | Seller and buyer | Split evenly |
FAS
Free Alongside Ship (over water
only) | Buyer arranges for ocean transport. Seller is responsible for packing,
labeling, preparing goods for shipment and delivering the goods to
the dock. | Seller: until the goods reach the dock.
Buyer: from dock to
destination. | Buyer pays all ocean transport costs. Selleris responsible for costs
associated with transporting the goods to the dock. |
FOB
Free On Board (over water only) | Seller arranges for ocean transport of the goods, preparing goods for
shipment, and loading the goods onto the vessel. | Buyer: once the items are on board. | Seller pays wharfage (charges to load the goods onto the ship) and freight
forwarder fees. |
CFR
Cost and Freight (over water
only) | Seller has the same responsibilities as when shipping FOB, but shipping
costs are prepaid by the seller. | Seller assumes risk until the shipment reaches the overseas
dock. | Seller pays costs of freight fees up to destination. |
CIF
Cost, Insurance, and Freight (over water
only) | Seller has the same responsibilities as when shipping CFR with the
addition of including a marine insurance policy. | Seller assumes risk until the shipment reaches the overseas
dock. | Seller pays insurance and freight forwarder fees. |
