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Free on board (f.o.b.)

When an exporter delivers goods ‘free on board’, he pays all charges involved in getting them actually on to the ship. His responsibilities include putting the goods in a condition for shipping. taking them to the ship and loading them.

The buyer must provide the ship, and the seller’s responsibility ends when the goods are on board. The seller must notify the buyer to enable him to insure the goods, otherwise he may himself be liable for damage at sea. Property in the goods normally passes with risk, though the buyer may reserve the right to reject the goods if he has had no previous opportunity to examine them and they are not up to specification or quality when he receives them.

Reference: The Penguin Business Dictionary, 3rd edt.