The Incoterm FAS, initials for Free Alongside Ship, is one of the Incoterms for maritime freight defined by the ICC in 2020. The FAS shipping term determines who is responsible for transporting the goods and clearing them for transport. Learn what Free Alongside Ship means in shipping and the responsibilities of seller and buyer when using the Free Alongside Ship Incoterm for exporting or importing goods by sea.
The Incoterm FAS or Free Alongside Ship means that the seller is obliged to get the goods cleared for export, packed and ready for loading onto the vessel at the port of origin. Following FAS shipping terms, the buyer must pay for the loading services and the freight transport.
Unlike other Incoterms, under the FAS shipping term, neither seller nor buyer is obliged to add insurance coverage to the cargo, although it is always advised.
In FAS / Free Alongside Ship, neither the seller nor the buyer has an obligation to purchase insurance for the cargo.
When shipping sea cargo under the delivery term FAS, the seller is only responsible for the goods until they reach the loading dock next to the selected vessel and is not obliged to insure the cargo. Because the buyer is liable for the cargo once it is left alongside the vessel, they are advised to add insurance coverage.
When using the Free Alongside Ship for shipping cargo, the seller is responsible for arranging transport, getting the goods to the port, and leaving them properly packed within reach of the ship lifting and loading structures (i.e. loading crane or lifting tackle).
Under the FAS Incoterm, they also must pay for inland or domestic transport in the country of origin, whether by hiring a freight forwarder or delivering the cargo themselves.
From the moment the cargo is delivered at the agreed location, the buyer is responsible for paying the international maritime shipping costs, which include loading and unloading.
For example: a company in Ireland (the seller) sells 100,000 units of merchandise to an American company (the buyer) under FAS terms. In this situation, the following responsibilities are applicable:
Following the Free Alongside Ship Incoterm in 2020 definition, the seller is responsible for clearing the goods for FAS export, as well as paying any export fees and preparing the necessary documentation.
The buyer must clear the goods for import at the country of destination. The buyer is also responsible for providing the required documents and permits to import the goods. This is a significant change from the previous version that was added to the FAS Incoterm in 2020. Read more about the customs procedures for freight shipments.
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