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With "FOB destination", the sale is complete at the buyer's doorstep and the seller is responsible for freight costs and liability during transport. [11] [12] The two terms have a specific meaning in commercial law and cannot be altered. But the FOB terms do not need to be used, and often are not.
The insurance to be provided under terms CIF and CIP has also changed, increasing from Institute Cargo Clauses(C) to Institute Cargo Clauses(A). Under the CIF Incoterms rule, which is reserved for use in maritime trade and is often used in commodity trading, the Institute Cargo Clauses (C) remains the default level of coverage, giving parties ...
The Dutch word "lading" has exactly the same meaning (freight, cargo, an amount of transportable goods) as it has in the English "bill of lading", but is not restricted to shipping. [ 17 ] Under English law, the Carriage of Goods by Sea Act 1992 provides that the term "bill of lading" includes a "received-for-shipment" bill of lading issued by ...
The 11 terms can also be classified into two different categories depending on its contents: [10] Rules for any modes of transport: ExW, FCA, CPT, CIP, DAT, DAP, DDP; Rules for sea and inland waterway transport: FAS, FOB, CFR, CIF.
Freight transport, also referred to as freight forwarding, is the physical process of transporting commodities and merchandise goods and cargo. [1] The term shipping originally referred to transport by sea but in American English , it has been extended to refer to transport by land or air (International English: "carriage") as well.
If it is a destination contract (FOB (buyer's city)), then risk of loss is on the seller. If it is a delivery contract (standard, or FOB (seller's city)), then the risk of loss is on the buyer. In cases not covered by the foregoing rules, if the seller is a merchant, then the risk of loss shifts to the buyer upon buyer's "receipt" of the goods.
CIF – Cost Insurance With Freight; ... FOB – Freight On Board; ... For example, $225K would be understood to mean $225,000, and $3.6K would be understood to mean ...
Uniform delivered pricing is the opposite of the FOB origin pricing, as the same price is quoted to all customers. The transportation costs are averaged across all buyers, and the nearby customers are in effect subsidizing the faraway ones (paying more for the delivery than it costs the seller, the difference is called the phantom freight).