FOB (Free on Board)
Definition
FOB is an Incoterms rule for sea and inland waterway transport where the seller delivers the goods on board the vessel nominated by the buyer at the named port of shipment; risk transfers to the buyer at that point, and the buyer arranges and pays for the main carriage.
Why It Matters
Under FOB the buyer typically nominates the vessel and freight forwarder, giving the buyer more control over shipping but also more responsibility.
Example
A buyer with its own freight forwarding relationships often prefers FOB terms to control freight costs and carrier selection.
Relevant Authority / Source
International Chamber of Commerce (ICC)