FCA - Free Carrier (named place of origin)

The most common term (almost 40% of international treaties are drawn up with this rule), because it is universal and easy to use. The best benefits are the use of any type of transport and any place of delivery of goods that is located in the seller’s country. There are 2 points of dispatch:

1. A point of dispatch of goods that belongs to the seller - this can be his warehouse, store, etc. Delivery is considered completed if the goods are loaded on the buyer's vehicle or transferred to the courier specified by the buyer.
2. A point that does not belong to the seller - it can be a seaport, airport, etc. Delivery is considered completed when the goods have been transferred to the carrier from the seller’s vehicle. Unloading goods from the seller’s vehicle is not the responsibility of the carrier. If the buyer instructed to give the seller a package of documents (for example, a bill of lading marked “on board” or an air waybill) then the carrier must provide all original consignment notes to the seller.

Who covers the logistics charges?

Distribution of costs according to the Incoterm negotiated in the contract. Classification according to the increased level of obligations for the seller

Seller’s Obligations

• Goods, commercial invoice and documentation
• Export packaging and marking
• Export licenses and customs formalities
• Pre-carriage to terminal
• Delivery to named place of delivery
• Cost of pre-shipment inspection
• Proof of delivery

Buyer’s Obligations

• Payment for goods at price agreed upon in sales contract
• Unloading from arriving means of transportation
• Loading charges
• Main carriage
• Discharge and onward carriage
• Import formalities and duties
• Cost of pre-shipment inspection (for import clearance)

Bottom Line

As mentioned above, FCA is generally considered the best F-group Incoterm to use. However, those same experts will usually say FCA has some definite downsides for sellers:

• There are some challenges if using a letter of credit under FCA as described above.
• The seller may not be familiar with the freight forwarder being used.
• There is potential for diversion of the goods before they leave the United States, or to another county after they leave the U.S in violation of the Export Administration Regulations (EAR).