F.O.B AND C.I.F.
This query is : Resolved
17 July 2007
Sir/Madam,
Cud u explain the meaning of F.O.B & C.I.F. Shipment & also difference in both.
Thanks/Gourav
Cud u explain the meaning of F.O.B & C.I.F. Shipment & also difference in both.
Thanks/Gourav
17 July 2007
FOB and CIF are the most popular commercial term in foreign trade. FoB means Free On Board. It means that all the costs up to the ship will be borne by the seller and once the goods are shiped the risk will pass on to buyer.
CIF means Cost Insurance And freight. All the costs upto the port of destination will be borne by the seller and once the goods arive at the port of destination the risk will transfer to the buyer.
All the terms are governed by the International Commercial Terms Draft.
CIF means Cost Insurance And freight. All the costs upto the port of destination will be borne by the seller and once the goods arive at the port of destination the risk will transfer to the buyer.
All the terms are governed by the International Commercial Terms Draft.
Message likes :
2 times
20 September 2007
For International Trade Following terms are most commonly used.
The following are a few of the more common terms used in international trade:
• CIF (cost, insurance, freight) to a named overseas port of import. Under this term, the seller quotes a price for the goods (including insurance), all transportation, and miscellaneous charges to the point of debarkation from the vessel. (Typically used for ocean shipments only.)
•CFR (cost and freight) to a named overseas port of import. Under this term, the seller quotes a price for the goods that includes the cost of transportation to the named point of debarkation. The cost of insurance is left to the buyer's account. (Typically used for ocean shipments only.)
•CPT (carriage paid to) and CIP (carriage and insurance paid to) a named place of destination. Used in place of CFR and CIF, respectively, for shipment by modes other than water.
•EXW (ex works) at a named point of origin (e.g., ex factory, ex mill, ex warehouse). Under this term, the price quoted applies only at the point of origin and the seller agrees to place the goods at the disposal of the buyer at the specified place on the date or within the period fixed. All other charges are for the account of the buyer.
•FAS (free alongside ship) at a named U.S. port of export. Under this term, the seller quotes a price for the goods that includes charges for delivery of the goods alongside a vessel at the port. The seller handles the cost of unloading and wharfage; loading, ocean transportation, and insurance are left to the buyer.
•FCA (free carrier) to a named place. This term replaces the former "FOB named inland port" to designate the seller's responsibility for the cost of loading goods at the named shipping point. It may be used for multimodal transport, container stations, and any mode of transport, including air.
•FOB (free on board) at a named port of export. The seller quotes the buyer a price that covers all costs up to and including delivery of goods aboard an overseas vessel.
When quoting a price, the exporter should make it meaningful to the prospective buyer. A price for industrial machinery quoted "EXW Baroda- India, not export packed" would be meaningless to most prospective foreign buyers. Such buyers would have difficulty determining the total cost and, therefore, would hesitate to place an order.
The exporter should quote CIF whenever possible, because it has meaning abroad. It shows the foreign buyer the cost of getting the product to a port in or near the desired country.
If assistance is needed in figuring the CIF price, you may contact an international marketing consultant or experts like: www.worldtradeconnecitons.co.in
The following are a few of the more common terms used in international trade:
• CIF (cost, insurance, freight) to a named overseas port of import. Under this term, the seller quotes a price for the goods (including insurance), all transportation, and miscellaneous charges to the point of debarkation from the vessel. (Typically used for ocean shipments only.)
•CFR (cost and freight) to a named overseas port of import. Under this term, the seller quotes a price for the goods that includes the cost of transportation to the named point of debarkation. The cost of insurance is left to the buyer's account. (Typically used for ocean shipments only.)
•CPT (carriage paid to) and CIP (carriage and insurance paid to) a named place of destination. Used in place of CFR and CIF, respectively, for shipment by modes other than water.
•EXW (ex works) at a named point of origin (e.g., ex factory, ex mill, ex warehouse). Under this term, the price quoted applies only at the point of origin and the seller agrees to place the goods at the disposal of the buyer at the specified place on the date or within the period fixed. All other charges are for the account of the buyer.
•FAS (free alongside ship) at a named U.S. port of export. Under this term, the seller quotes a price for the goods that includes charges for delivery of the goods alongside a vessel at the port. The seller handles the cost of unloading and wharfage; loading, ocean transportation, and insurance are left to the buyer.
•FCA (free carrier) to a named place. This term replaces the former "FOB named inland port" to designate the seller's responsibility for the cost of loading goods at the named shipping point. It may be used for multimodal transport, container stations, and any mode of transport, including air.
•FOB (free on board) at a named port of export. The seller quotes the buyer a price that covers all costs up to and including delivery of goods aboard an overseas vessel.
When quoting a price, the exporter should make it meaningful to the prospective buyer. A price for industrial machinery quoted "EXW Baroda- India, not export packed" would be meaningless to most prospective foreign buyers. Such buyers would have difficulty determining the total cost and, therefore, would hesitate to place an order.
The exporter should quote CIF whenever possible, because it has meaning abroad. It shows the foreign buyer the cost of getting the product to a port in or near the desired country.
If assistance is needed in figuring the CIF price, you may contact an international marketing consultant or experts like: www.worldtradeconnecitons.co.in
Message likes :
2 times
21 November 2007
detailed answer by Sri.Shailashkumar
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Is this income indian or foreign income?
- REGARDING GST ON COMMERICIAL PROPERTY
- 15ca /15cb whose income tax login? remitter or nri seller's login?
- RCM applicability on Rent Paid by Registered Person to Unregistered Landlord for Residental Building
- ITC temporary reversal and reclaim
- GST on export of services and Input Credit
- TDS U/S. 194NF
- Regarding Documentation & Compliances for Opening of Unit of Pvt Ltd.
- Applicable TDS rate for sale of property in Nov 2024
- Capital gain consideration
- VERIFICATION OF REFUND RELATED
- GST Regis.
- ITC c/f from FY2022-23 to FY2023-24 entered the same in table 8C of GSTR9 of FY 2022-23, in FY23-24
- Late filling fees Demand by gst office
- IGST Credit-Show cause notice issued-confusion
- Short and Excess provision of expenses
- Issue of gst e invoice
- Interchangeable words in accounts
- Adjusted profit/Loss in the case of LLP and Pvt. Ltd.company
- How to adjusted advances given or receipt
Trending Online Classes
CAclubindia
