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Cost, Insurance and Freight (CIF) and Free on Board (FOB) are international shipping agreements used in the transportation of goods between a buyer and a seller. The specific definitions are different for every country, but CIF and FOB have similar uses. They differ in who assumes responsibility for the goods during transit. Both contracts specify origin and destination information that is used to determine where liability officially begins and ends.

In CIF agreements, insurance and other costs are assumed by the seller, with liability and costs associated with successful transit paid by the seller up until the goods are received by the buyer. Goods are not considered to be delivered until they are in the buyer's possession.

FOB contracts relieve the seller of responsibility once the goods are shipped. Once goods have passed the ship's rail, they are considered to be delivered into the control of the buyer. When shipping to the buyer begins, the buyer then assumes all liability.

Each agreement has particular advantages and drawbacks for both parties. While sellers often prefer FOB and buyers prefer CIF, some trade agreements find one method more convenient for both parties. A seller with expertise in local customs that the buyer lacks would likely assume responsibility to encourage the buyer to accept a deal, for example. Smaller companies may prefer the larger party to assume liability, as this can result in lower costs. Some companies also have special access through customs, document freight charges when calculating taxation, and other needs that necessitate a particular shipping agreement.

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