FAS Incoterms 2020: Free Alongside Ship
Under FAS the seller clears the goods for export and places them alongside the buyer's ship at the named port. The buyer pays loading, ocean freight and everything after.
FAS Free Alongside Ship
Sea and inland waterway only
| Step | FAS |
|---|---|
| Export packing and marking | Seller |
| Loading at the seller's premises | Seller |
| Export customs clearance | Seller |
| Transport to the port or terminal | SellerRisk passes to the buyer here |
| Terminal charges and loading at origin | Buyer |
| Main carriage (ocean or air freight) | Buyer |
| Cargo insurance | Not required by the rule |
| Unloading at destination terminal | Buyer |
| Transport to the named place | Buyer |
| Unloading at the named place | Buyer |
| Import clearance, duties and taxes | Buyer |
- FAS
- Risk passes: When the goods are placed alongside the vessel (on the quay or a barge) at the named port of shipment.
- Costs: Alongside the ship, export cleared. The buyer pays loading on board, freight and everything after.
What does FAS mean?
FAS (Free Alongside Ship) means the seller delivers when the goods are placed alongside the vessel nominated by the buyer, on the quay or on a barge, at the named port of shipment. The seller clears the goods for export. From that point the buyer pays for loading the ship, the ocean freight and everything after, and bears the risk.
FAS is a sea and inland waterway rule only. It is meant for bulk and heavy cargo that is loaded directly onto the ship, not for containers.
Seller and buyer obligations under FAS
| Seller | Buyer |
|---|---|
| Delivers the goods alongside the named vessel at the named port, within the agreed period | Nominates the vessel, the loading point and the date |
| Clears the goods for export and pays export fees | Pays for loading on board, ocean freight and insurance it wants |
| Provides the commercial invoice and proof of delivery (such as a dock receipt) | Clears import and pays duties and taxes |
Example
A timber exporter sells logs "FAS Port of Tauranga, New Zealand, Incoterms® 2020". The exporter trucks the logs to the berth the buyer named and stacks them alongside the vessel. The buyer's chartered ship loads them with its own cranes. A log that falls into the harbour during loading is the buyer's loss.
Who uses FAS?
- Bulk commodities such as grain, ore and timber, where the buyer charters the ship.
- Project and heavy lift cargo that needs special loading gear arranged by the buyer.
- Trades where port loading costs vary a lot and the buyer wants to control them.
FAS vs FOB
The only difference is the loading. Under FAS, risk and cost pass before loading, alongside the ship. Under FOB, the seller also pays and takes the risk of loading until the goods are on board. For containerised goods, neither is the right rule: use FCA, because containers are handed to a terminal, not placed alongside a ship.
Watch the port details
Ports handle cargo in different ways, and port customs vary on which charges fall before or after "alongside". Name the exact berth or loading point and, where it matters, say in the contract who pays terminal handling charges.
Whatever the rule, the seller provides a commercial invoice that names the Incoterm and place, and usually a packing list. For quotes before the order, use a proforma invoice with the same rule written on it.
Features
- Who does each step under FAS
- Where risk passes, marked on the chart
- Compare FAS with FOB or any other rule
- Link to the Incoterms chooser
Frequently asked questions
What does FAS mean in shipping?
FAS means Free Alongside Ship. The seller clears the goods for export and places them alongside the buyer's vessel at the named port. The buyer pays for loading and the voyage.
Can FAS be used for containers?
It is not recommended. FAS is meant for goods placed alongside a ship, such as bulk cargo. Containers are handed to a terminal, so FCA fits them better.
Who pays loading under FAS?
The buyer pays for loading the goods on board. Under FOB the seller would pay for loading.
Who clears export under FAS?
The seller. Since Incoterms 2010, the seller handles export clearance under FAS.