Determine who Has the Responsibility for Loading and Unloading Charges
In terms of delivery such as DAP, DPU or DDP, the Seller; is obliged to deliver the goods to the carrier who will deliver them to the named place of destination. The Buyer is responsible for unloading the goods.
Under CPT, CIP, CFR or CIF terms, the seller completes the delivery when the goods arrive at the port or place of destination. After the goods have been delivered to the agreed port or place, the Buyer assumes responsibility from that point forward.
Under the FCA, the seller’s obligations are fulfilled after the goods are delivered “to the carrier designated by the buyer, on the first truck or at the port of origin, at the agreed place.” Buyer is responsible for domestic freight, unloading at port of origin and loading onto ocean carrier/airline.
Know where the Risk of Loss Transfers
For EXW, the risk is transferred at the Seller’s facility or at the agreed location, which is usually the first truck. For FAS or FOB the risk is transferred at the port of loading when the cargo arrives at the shipyard/terminal or after it is loaded onto the ship/aircraft respectively, while for FCA the risk transfer may be the first carrier or the port of loading. When the seller pays the freight, a common misconception for buyers is to assume that all risk of loss rests with the seller until the goods are delivered to the specified destination or port specified on the bill of lading or invoice. When using CFR, CIF, CPT or CIP, the risk passes to the buyer when the goods are loaded on the first truck, delivered to the carrier at exit. For DPU, DAP or DDP, the risk is transferred after the goods are delivered to the destination.
