Definition

FOB

1 If the price is based on FOB (Free on Board), it means the seller is responsible for the cost of the goods and its delivery charges all the way to the goods being delivered on board the vessel leaving the designated city. Thus FOB must state the city where the vessel will depart.


2 Free on Board (FOB) means that the seller fulfills his obligation to deliver when the goods have passed over the ship’s rail at the named port of shipment. This means that the buyer has to bear all costs and risks of loss or damage to the goods from that point on.