Feb 02 2012
FAS versus FOB in Freighter Importing and Exporting
FAS is the acronym for Free Alongside Ship. FAS is only used for sea and inland transportation, though. FOB is the acronym for Free on Board and takes place when goods are delivered directly onto the vessel.
Some FAS Facts
• It is the onus on the seller to clear goods for export.
• It is the duty of the seller to get a license and any other authorisation for exportation and to deal with anything else to do with customs in order to export the goods.
• The seller has to deliver any goods alongside the ship which has been selected by the buyer and the agreed port on the agreed date.
• If anything should go wrong whilst the goods are loaded, then this account is for the buyer.
• It is the seller’s obligation to obtain proof of delivery, as it might not be possible to receive a transport document.
• Once the documentation has been offloaded, it is then the duty of the buyer to take possession of the goods.
• The buyer has to pay for the transportation of the goods from port to destination.
• The onus is on the buyer to receive import licenses and any documentation regarding importation of the goods to the final destination and also any transportation of these goods.
• If the ship or vessel is not on time, the onus of the costs will fall onto the buyer.
Some FOB Facts
• With FOB the goods are loaded directly onto a vessel as opposed to being loaded alongside the vessel.
• The onus falls onto the seller to clear goods for exportation and to arrange the export license and any other documentation.
• The seller is obliged to take care of the storage, handling and loading charges, but is not responsible for the goods to be taken from port to the destination.
• Once the goods are safe, the responsibility is then that of the buyer.
• The seller can arrange the sea freight, although it is the buyer’s option to select the ship or vessel; sometimes the seller is able to get a better deal.
• If the vessel is not on time, the buyer is obligated to re-imburse the seller for any costs incurred.
• As with FAS, it is the buyer’s duty to arrange the import documentation and license.
FOB or FAS; there are distinct advantages and disadvantages with both.