In shipping, FAS (Free Alongside Ship) means the seller fulfills their delivery obligation when the goods are placed alongside the vessel at the port of shipment, after which the buyer assumes all costs and risks.
Definition
Free Alongside Ship (FAS) is an Incoterm used in international trade that specifies the seller’s responsibility to deliver goods alongside a vessel at a designated port. The risk transfers to the buyer once the goods are placed alongside the ship, making it the buyer’s responsibility to handle loading, shipping, and insurance from that point onward.
Responsibilities and Considerations
Seller’s Responsibilities
The seller is responsible for all costs and risks associated with bringing the goods to port and placing them alongside the buyer’s vessel. This includes export clearance and all associated costs up to that point.
Buyer’s Responsibilities
The buyer assumes responsibility once the goods are alongside the vessel. The buyer is responsible for loading the goods onto the vessel and all subsequent costs including freight, insurance and import duties.
※FAS is typically used for bulk cargo, such as oil or grain, that is shipped by sea or inland waterway. It is not suitable for containerized freight.
Here are examples of how the “Free Alongside Ship” (FAS) Incoterm might be applied in trade between the United States and China:
A U.S. farmer sells a large shipment of corn to a Chinese importer. Under FAS terms, the farmer is responsible for transporting the corn to the Port of New Orleans. The farmer handles all necessary export documentation and clearance, ensuring the corn is placed alongside the buyer’s designated vessel. Once the corn is alongside the ship, the Chinese buyer takes over responsibility, arranging for the corn to be loaded onto the vessel. The buyer then covers the sea freight to China, secures insurance for the shipment, and manages all import duties and clearance upon arrival at a Chinese port.
Being aware of Incoterms allows you to navigate through international shipping, and in need of a reliable international logistics carrier, contact us.
12 Dec, 2024
