FCA – Free Carrier (Place of Delivery) - Incoterms 2020

Explained

If the place of delivery is at the seller premises, the seller must load the goods. If delivery takes place in a different place, the seller is not responsible for unloading.

The term carrier refers to any party who is in charge of the contract of carriage and will transport the goods by any mode of transportation.

There can be 2 types of places of receipt when using FCA, sellers facility or another place (usually a freight forwarders facility or port/airport terminal). The seller must load goods into a transport vehicle (arranged by the buyer) only when the place of receipt is the seller’s facility.

When the place of delivery is an inland point, Incoterms® 2020 allows the buyer to instruct the carrier to issue a bill of lading with an onboard notation. The seller must provide the buyer with the documentation with the same clause as explained in the contract. It has to be noted that the seller is under no obligation to carrier clauses.

The seller must clear customs for exports and freight and international transport arrangements must be performed by the buyer.

Doing Business

When the named place is another than sellers facility, the seller is not required to unload as it is assumed that the receiving facility has the means for it (i.e a warehouse freight station for LCL cargo or a Container Terminal).

FCA can be used for any mode of transportation or a combination (multimodal)

It is advised that the buyer selects clearly the place of delivery. For instance “Kuehne and Nagel - East Shanghai Road NO. 5 Room 1103, Huaqiao Mansion, 215400 Suzhou City” is more explicit than simply “Kuehne and Nagel Shangai Warehouse”.

FCA is one of the most favorable terms when the buyer wants to have control of costs at origin and international transportation through a nominated freight forwarder. FCA is commonly used in conjunction with a Forwarder Cargo Receipt (FCR), a document that proves that cargo has been received by a forwarder with the intention to be transported as per buyer’s conditions. FCR is a proof of delivery and can be used for document compliance instead of Bill of Lading

FCA requires that buyers pays for origin terminal handling charge when cargo is containerize. A “carrier” means any company that has been nominated by the buyer to act as a transport agent, meaning that a freight forwarder qualifies as carrier in this case.

It is recommended to use FCA instead of FOB for containerized cargo. In the case of FCL, the container can be placed at the seller’s facility. If cargo will be transported as LCL, in most cases it is required that seller deliver goods into a nominated warehouse for consolidation.

Carriers clauses

There are different carrier types that could take delivery. An inland carrier for road transportation, a freight forwarder for multimodal transportation, an airline, rail transport company or a shipping line. For ocean shipments, it is common to use “On Board” when goods are on the vessel. When the Bill of Lading is issued before on board, “Received for Shipment” is allowed by carriers (i.e. Freight Forwarders).

Examples

At sellers facility (shipper must load cargo into container):

FCA ABB - 1133 South Cavalier Drive, Alamo USA - Incoterms® 2020

At forwarders facility (buyer pays for unloading cost):

FCA Panalpina World Transport
6/F AZIA Center, 1233 Lujiazui, Ring Road
Pudong New Area, Shanghai 200120, China
Incoterms® 2020

At the airport:

FCA KLM - Menzies World BV, Brandenburgbaan 2b, 3045 AK Rotterdam - Incoterms 2020

Seller and Buyer obligations

THE SELLER’S OBLIGATIONS	THE BUYER’S OBLIGATIONS
1. General The seller must deliver the goods, commercial invoice, and evidence of conformity	1. General The buyer must pay the price of goods as agreed in the contract of sale
2. Delivery Deliver the goods at the agreed point, date or period. If no time is notified, when goods have been loaded or placed at disposal of the carrier	2. Taking Delivery The buyer takes the goods after delivered in the agreed time.
3. Risks All risk of loss/damage until goods have been delivered	3. Risks All risk of loss/damage from the time or end of the period agreed for delivery. If the buyer fails to nominate a carrier, or if the carrier doesn’t pick up the goods, the risk is under the buyer.
4. Carriage No obligation to make a contract of carriage. Provide at buyers risk and cost, information for arranging carriage. If agreed, the seller must contact the carrier.	4. Carriage Contract the carriage from the place of delivery unless agreed with the seller.
5. Insurance No obligation. Provide at buyers risk and cost, any required information.	5. Insurance No obligation to insure the goods.
6. Delivery/transport document Proof of delivery at sellers cost and a transport document if arranged by seller	6. Delivery/transport document Accepts the proof of delivery. If agreed the buyer must instruct the carrier to issue a transport document.
7. Export/Import clearance All export clearance expenses (license, security, inspection, etc). Assist with import clearance	7. Export/Import clearance Assist with export clearance. Import clearance and formalities (licenses, security, official documentation).
8. Checking The seller must check, count, weight, mark, and package goods	8. Checking No obligation.
9. Allocation of cost Pay all the cost until delivery. Cost of proof of delivery. Duties and taxes for export. All costs related to providing assistance in obtaining documents to the buyer	9. Allocation of cost Pay from the time goods delivered. All costs for assistance on getting carriage, insurance, delivery, and customs documentation. Pay duties and taxes for import or transit. Any additional cost if the carrier is not nominated or carrier fails to collect goods.
10. Notices Give notice that goods have been delivered or failed to be collected by carrier.	10. Notices Notify the carrier nominated, time or period, mode fo transportation and the point where goods will be received.

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