Free On Board - FOB
Definition of 'Free On Board - FOB'A trade term requiring the seller to deliver goods on board a vessel designated by the buyer. The seller fulfills its obligations to deliver when the goods have passed over the ship's rail.When used in trade terms, the word "free" means the seller has an obligation to deliver goods to a named place for transfer to a carrier. |
|
Investopedia explains 'Free On Board - FOB'Contracts involving international transportation often contain abbreviated trade terms that describe matters such as the time and place of delivery and payment, when the risk of loss shifts from the seller to the buyer, as well as who pays the costs of freight and insurance.The most commonly known trade terms are Incoterms, which are published by the International Chamber of Commerce. These are often identical in form to domestic terms, such as the American Uniform Commercial Code, but have different meanings. As a result, parties to a contract must expressly indicate the governing law of their terms. It's important to realize that because this is a legal term, its exact definition is much more complicated and differs by country. It is suggested that you contact an international trade lawyer before using any trade term. |
Related Definitions
Articles Of Interest
-
What Is International Trade?
Everyone's talking about globalization, so we explain what is it and why some oppose it. -
What Is The World Trade Organization?
The WTO sets the global rules of trade. But what exactly does it do and why do so many oppose it? -
Exploring The Current Account In The Balance Of Payments
Learn how a country's current account balance reflects the country's economic health. -
What Is The Balance Of Payments?
The balance of payments helps countries to track how much money is coming in and how much money is going out. Learn more about BOPs here. -
Economic Indicators That Do-It-Yourself Investors Should Know
Understanding these investing tools will put the market in your hands. -
Why The Consumer Price Index Is Controversial
Find out why economists are torn about how to calculate inflation. -
Predict Inflation With The Producer Price Index
Find out how the PPI can be used to gauge the overall health of the economy. -
Leading Economic Indicators Predict Market Trends
Leading indicators help investors to predict and react to where the market is headed. -
Austerity: When The Government Tightens Its Belt
When a government tightens its belt in tough economic times the entire nation feels the squeeze. -
Will Quantitative Easing Be Japan's Savior?
The quantitative easing program, recently announced by the new governor of the Bank of Japan, Haruhiko Kuroda, is for a cash infusion of $1.4 trillion by the end of 2014. Will it help the Japanese ...
Free Annual Reports