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In the past, the FOB point determined when title transferred for goods. For example, at year- and period-end goods in transit under "FOB destination" (North American usage) appear on the seller's balance sheet but not in the buyer's balance sheet, as the risk and rewards of ownership change to the buyer at the "destination" port.
However, FOB is commonly used incorrectly for all modes of transport despite the contractual risks that this can introduce. In some common law countries such as the United States of America, FOB is not only connected with the carriage of goods by sea but also used for inland carriage aboard any "vessel, car or other vehicle." [22]
FOB place of business—The seller assumes risk of loss until the goods are placed on a carrier. FOB destination: the seller assumes risk of loss until the shipment arrives at its destination. If the contract leaves out the delivery place, it is the seller's place of business. Risk of loss—Equitable conversion does not apply.
FOB is an INCOTERM meaning that the seller delivers when the goods pass the ship's rail at the named port of shipment. This means that the buyer has to bear all costs and risk of loss of or damage to the goods from that point. The FOB term requires the seller to clear the goods for export.
Latest shipment date or given period for shipment. The first beneficiary may demand from the transferring bank to substitute for the applicant. However, if a document other than the invoice must be issued in a way to show the applicant's name, in such a case that requirement must indicate that in the transferred credit it will be free.
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Modern freight forwarders offer an end-to-end process i.e. shipping the goods from the place of origin to the final destination and may offer additional services such as warehouse planning, cargo insurance and customs brokerage. [8] In a single transaction, the forwarder may be acting as a carrier (principal) or as an agent for his customer or ...
The objective of DEPB is to neutralise the incidence of Customs duty on the import content of the export product. The neutralisation shall be provided by way of grant of duty credit against the export product. Under the DEPB, an exporter may apply for credit, as a specified percentage of FOB value of exports made in freely convertible currency.