This term means that the seller delivers when the goods pass the ship’s rail at the named port of shipment. This
means the buyer has to bear all costs & risks to the goods from that point. The seller must clear the goods for export. This term can only be used for sea transport. If the parties do not intend to deliver the goods across the ship’s
rail, the FCA term should be used [1]
“Free On Board” means that the seller delivers the goods on board the vessel nominated by the buyer at the named port of shipment or procures the goods already so delivered. The risk of loss of or damage to the goods passes when the goods are on board the vessel, and the buyer bears all costs from that moment onwards.[2]
Reference
[1]
[2] https://iccwbo.org/resources-for-business/incoterms-rules/incoterms-rules-2010/
