In the ever-evolving landscape of global trade, understanding specific shipping terms and Incoterms is crucial for both buyers and sellers. The FAS (Free Alongside Ship) Incoterm, a pivotal element in international shipping, plays a significant role in mitigating the confusing waters of who is responsible for what, depending on access to the vessel and liability.
The FAS rule explains that the seller is responsible for delivering goods to the port alongside the vessel, marking the point where risk and cost responsibility shifts to the buyer. Let’s delve into the intricacies of FAS, providing insights into when it's most appropriate to use this Incoterm and its implications in global trade.
Note: The use of this Incoterms rule is restricted to goods transported by sea or inland waterway.
Did you know? This Incoterms rule is popular for bulk cargo where the seller has direct access to the vessel. In general, the FCA Incoterms rule is used when containerized shipments are delivered to a terminal.
When to Use FAS
Free Alongside Ship (FAS) is particularly advantageous in specific scenarios. It is best utilized when:
- The seller has direct access to the ship for loading bulk cargo.
- The goods are oversized or difficult to handle, making direct ship loading preferable.
- The buyer prefers to control shipping from the port, managing costs and risks associated with transportation beyond the port.
Still, there a few additional reasons to leverage the FAS Incoterm
- FAS is ideal for shipments where the seller can ensure direct delivery alongside the vessel, reducing complexities in handover.
- It provides clarity in cost allocation, with the seller covering transport to the ship and the buyer taking over from there.
- This Incoterm is most suitable for sea or inland waterway transport due to the requirement of goods being alongside the ship.
- The buyer may also wish to ensure proper loading and handling of the cargo to the ship, particularly important for high-value and heavy-lift shipments.
Where the FAS Limitations End
Free Alongside Ship (FAS) Incoterms are restricted to goods transported by sea or inland waterway, such as barge. This restriction is inherent to the term 'alongside ship,' indicating that goods must be delivered directly next to the vessel. In scenarios where the goods must be handed off to another party before reaching the terminal, another Incoterm, such as FCA (Free Carrier), might be more suitable. This ensures a smooth transition and clearer responsibility delineation at the handover point.
The FAS Incoterm also delineates a clear shift in liability and coverage from the seller to the buyer before the ship departs.
While the seller is responsible up to the point of delivery alongside the vessel, all subsequent costs and liabilities fall to the buyer. This arrangement is ideal for buyers seeking control over the shipping process beyond the port. However, if a buyer prefers less liability and only wishes to take on responsibility upon arrival at a named place or wants the seller to cover import costs, alternative Incoterms like Delivered Duty Paid (DDP) or Delivered at Place (DAP), might be more appropriate.
Get Help With FAS and All Incoterms With Crane Worldwide Logistics
As we navigate the complexities of international trade, understanding the responsibilities and obligations for both sellers and buyers under various Incoterms is essential. With eleven different Incoterms covering international shipments, it can feel a bit like Alphabet Soup, but there is clarity and peace of mind in knowing when to use each.
Crane Worldwide Logistics offers unparalleled expertise in global trade, assisting clients across countries with their shipping needs and keeping your shipments flowing by using the right Incoterm on every load. Request your quote to get started now.
More detail onIncoterms:
Click below for moreinformation on shipping terms:
FCA (Free Carrier)
CPT (Carriage Paid To)
CIP (Carriage and Insurance Paid To)
DAP (Delivered at Place)
DPU (Delivered at Place Unloaded)
DDP (Delivered Duty Paid)
FAS (Free Alongside Ship)
FOB (Free On Board)
CFR (Cost And Freight)
CIF (Cost, Insurance And Freight)
FREE DOWNLOAD: You can download our free Incoterms chart which providessimple explanations of all eleven incoterms here
