Hell, everyone, this is Gary, I am the international trade manager from Extripod. Welcome to “Extripod Academy”, This is “International Trade Basic Knowledge” Series, in this series, we will discuss the international trade rules, payment, transporation, organization, certification and country situation, i hope those knowledges can help your doing success in the international trade business.if you have any question realted those issue, you can leave comment or go to our website www.extripod.com to contact us. Our more connect as follow. If you like our channel, please also subscribe our channel. Thank!
Incoterms 2020 FCA
Last time we are talk about the Exw for E group, so those are only one rule, and most people use this rule for domestic business. EXW is not like Internationale trade transport rule. But FCA is difference, more than approximate 40% of contract all over the world are use this kinds of rule to signed contact. FCA is comprehensive because it applies to all modes of transport.
So we are will use the same way to discuss FCA rule. Cost, Obligation, delivery, insurance. End with conclusion. So let start to learn what’s FCA.
Incoterm 2020 FCA – Cost-sharing
Let look what’s kinds of cost the seller should be bear.
1.The costs of export clearance.
2.The costs of delivering and entrusting the goods to a carrrier,
3. The costs of obtaining an export license or other authorization, taxes, duties and additional official export charges,
4. Costs in case of a ban on the export of the products or costs if there are special taxes on its export,
5. The costs of providing the document proving the delivery of the goods
6. Costs of preparing and sending the commercial invoice
7. Costs of informing the buyer that the goods have been delivered and entrusted to the carrrier or have not been accepted by the carrrier at the agreed time,
8.The costs of packaging and marking required for transport, unless the goods are generally transported without packaging,
9. The costs of quality control, measurement, weighing, and counting.
So what’s the buyer takes the costs:
1. The costs related to import issues and transport of goods from the moment of delivery to the courier by the seller,
2. Any Additional costs related to non-compliance with the obligation to take delivery of the goods at the place and time agreed in the contract,
3. The costs of obtaining documents issued in the country of consignment or origin which are necessary for the buyer to import or transit the goods,
4. Costs of informing the seller about the date and place where the goods will be delivered to the carrrier,
5. Costs related to the transport of the products,
6. Costs of unloading the delivered goods from the means of transportation in the terminal of the carrrier designated by the buyer,
7. All costs relating to the products from the time they are put at the disposal of the carrrier designated by the buyer (including customs duties and taxes and other official charges),
8. All additional costs resulting from not designating a carrrier or notifying the seller of the name of the carrrier and the designated date when the goods are to be delivered to the carrrier,
9. The costs of pre-shipment inspection of the goods, unless the authorities compulsorily require this of the exporting country.
So those are cost from buyer to seller. How about the obligation for both parties?
Incoterm 2020 FCA – Obligations
What are the obligations of the seller?
1.The seller has to provide the goods, the commercial invoice and other evidence of conformity as may be required and specified in the contract,
2.Upon request and at the buyer’s expense, the seller enables and assists in obtaining a shipping document,
3. Appoints a person responsible for loading the goods to the vehicle(v啊扣) of the purchaser of the products,
4. The seller is responsible for preparing the goods for loading (measurement and packing of the goods),
5. Seller adjusts the goods for export and bears the risks and costs involved,
6. At the request of the buyer, the seller may conclude a contract of carriage on normal terms and conditions at the cost and risk of the buyer.
What are the obligations of the buyer?
1. The buyer completes the formalities related to the import of goods and their transport from the moment of delivery by the seller to the courier,
2. The buyer bears the risk of losing or damaging the products from the moment of delivery to the courier,
3. It concludes transport contracts, although the seller may (as an additional service) arrange transport at the expense and risk of the buyer,
4. The buyer takes care of all necessary transit formalities and preparing the goods to import,
5. The buyer orders transport, he takes delivery of the goods at the place agreed upon in the contract in advance.
Those the obligation for both side, buyer and sell. How about the delivery ?
Incoterm 2020 FCA – Delivery
The Incoterms 2020 FCA has two possible delivery locations. A first variant is a place belonging to the seller (e. g. his warehouse, factory). The delivery is deemed have been completed when the goods are physically handed over to a courier or other person designated by the buyer. The handed over must after loading has been completed.
The second option concerns the place, which does not belong to the seller (e. g. seaport, terminal). In such a case, the delivery is deemed to have taken place after the goods have been handed over to the carrrier in the mode of transport sent by the seller. It should be noted that the unloading of products from the mode of transportation is not the responsibility of the seller.
Regardless of the chosen option, information about the place, and time of delivery should be included in the contract.
OK, this is delivery location issue related FCA. Then we talk about the Insurance.
Incoterm 2020 FCA – Insurance
Insurance of the goods on Incoterms 2020 FCA
In the case of FCA Incoterms, insurance is the responsibility of the buyer. The seller is not responsible for the products from the moment of delivery at the place specified in the contract. The further transport, as well as the insurance of the goods, depends on the buyer.
Incoterm 2020 FCA – Conclusion
The FCA formula can be applied to all modes of transport, including combined transport (where different modes of transport are used).
The seller must deliver the goods and commercial invoice in accordance with the sales contract and any other evidence of conformity that may be required in the contract. Besides, he assists in obtaining the transport document at his own expense and risk,
However, this is optional and unnecessary if the seller and the buyer agree that the seller will provide a waybill stating that the goods have been delivered for dispatch and that they have not been sent on board.
FCA and other Incoterms rules
In the case of the FCA rule, as with all other Incoterms 2010 rules (except EXW), the seller is charged with all procedures related to the export of goods.
At both EXW and FCA, the importer has a transport authority for the entire delivery route. In EXW rule the seller is not obliged to load the goods or clear the goods for export. In the FCA Incoterms, the obligation of export clearance is on the seller. The obligation of loading depends on the mode of transport. For this reason, it is recommended to use the FCA instead of EXW.
Those the main description for FCA if you do not understand the please check the text content from you website blog. The link at below. That will help to understand this Incoterm rule well. Next time we will talk about the FAS.
At the end of this talk, if you have any suggestion, please leave your comment under this video, we will choose and some to reply, If you think my content is ok, please subscript our channel, move your finger to support us, let us do more useful video to help you growth in international trade business. All text content you can find in our website. www.extripod.com. Thanks for your watch and see your next time!
A1 GENERAL OBLIGATIONS
The seller must provide the goods and the commercial invoice in conformity with the contract of sale and any other evidence of conformity that may be required by the contract.
Any document to be provided by the seller may be in paperor electronic form as agreed or, where there is no agreement as is customary.
B1 GENERAL OBLIGATIONS
The buyer must pay the price of the goods as provided in the contract of sale
Any document to be provided by the buyer may be in paper or electronic form as agreed or, where there is no agreement as is customary.
The seller must deliver the goods to the carrier or another person nominated by the buyer at the named point, if any, at the named place, or procure goods so delivered.
The seller must deliver the goods
1. on the agreed date
2. at the time within the agreed period notified by the buyer under B10(b)
3. if no such time is notified, then at the end of the agreed period.
Delivery is completed either:
a) If the named place is the seller´s premises, when the goods have been loaded on the means of transport provided by the buyer;
b) In any other case, when the goods are placed at the disposal of the carrier or another person nominated by the buyer on the seller´s means of transport ready for unloading.
If no specific point has been notified by the buyer under B10(d) within the named place of delivery, and if there are several points available, the seller may select the point that best suits its purpose.
B2 TAKING DELIVERY
The buyer must take delivery of the goods when they have been delivered under A2.
A3 TRANSFER OF RISKS
The seller bears all risks of loss of or damage to the goods until they have been delivered in accordance with A2,with the exception of loss or damage in the circumstance described in B3.
B3 TRANSFER OF RISKS
The buyer bears all risks of loss of or damage to the goods from the time they have been delivered under A2.
a)the buyer fails to nominate a carrier or another person under A2 or to give notice in accordance with B10; or
b) the carrier or person nominated by the buyer under B10(a) fails to take the goods into its charge, then the buyer bears all risks of loss of or damage to the goods;
(i) from the agreed date, or in the absence of an agreed date,
(ii) from the time selected by the buyer under B10(b); or, if no such time has been notified,
(iii) from the end of any agreed period for delivery, provided that the goods have been clearly identified as the contract goods.
The seller has no obligation to the buyer to make a contract of carriage. However, the seller must provide the buyer, at the buyer´s request, risk and cost, with any information in the possession of the seller, including transport-related security requirements, that the buyer needs for arranging carriage. If agreed, the seller must contract for carriage on the usual terms at the buyer s risk and cost.
The seller must comply with any transport-related security requirements up to delivery.
The buyer must contract or arrange at its own cost for the carriage of the goods from the named place of delivery, except when the contract of carriage is made by the seller as provided for in A4.
The seller has no obligation to the buyer to make a contract of insurance. However, the seller must provide the buyer, at the buyer s request, risk and cost with information in the possession of the seller that the buyer needs for obtaining insurance.
The buyer has no obligation to the seller to make a contract of insurance.
A6 DELIVERY/TRANSPORT DOCUMENT
The seller must provide the buyer at the seller´s cost with the usual proof that the goods have been delivered in accordance with A2.
The seller must provide assistance to the buyer, at the buyer´s request, risk and cost, in obtaining a transport document.
Where the buyer has instructed the carrier to issue to the seller a transport document under B6, the seller must provide any such document to the buyer.
B6 DELIVERY/TRANSPORT DOCUMENT
The buyer must accept the proof that the goods have been delivered in accordance with A2.
If the parties have so agreed, the buyer must instruct the carrier to issue to the seller, at the buyer´s cost and risk, a transport document stating that the goods have been loaded (such as a bill of lading with an onboard notation).
A7 EXPORT/IMPORT CLEARANCE
a) Export clearance
Where applicable, the seller must carry out and pay for all export clearance formalities required by the country of export, such as
• export licence;
• security clearance for export;
• pre-shipment inspection; and
• any other official authorisation.
b) Assistance with Import clearance
Where applicable, the seller must assist the buyer, at the buyer´s request, risk and cost, in obtaining any documents and/or information related to all transit/import clearance formalities, including security requirements and pre-shipment inspection, needed by any country of transit or the country of import.
B7 EXPORT/IMPORT CLEARANCE
a) Assistance with export clearance
Where applicable, the buyer must assist the seller at the seller´s request, risk and cost in obtaining any documents and/or information related to all export clearance formalities, including security requirements and pre-shipment inspection, needed by the country of export.
b) Import clearance
Where applicable, the buyer must carry out and pay for all formalities required by any country of transit and the country of import, such as:
•import licence and any licence required for transit;
•security clearance for import and any transit;
•pre-shipment inspection; and
•any other official authorisation.
The seller must pay the costs of those checking operations (such as checking quality, measuring, weighing counting) that are necessary for the purpose of delivering the goods in accordance with A2.
The seller must, at its own cost, package the goods, unless it is usual for the particular trade to transport the type of goods sold unpackaged. The seller must package and mark the goods in the manner appropriate for their transport, unless the parties have agreed on specific packaging or marking requirements.
The buyer has no obligation to the seller.
A9 ALLOCATION OF COSTS
The seller must pay:
a)all costs relating to the goods until they have been delivered in accordance with A2, other than those payable by the buyer under B9;
b)the costs of providing the usual proof to the buyer under A6 that the goods have been delivered;
c)where applicable, duties, taxes and any other costs related to export clearance under A7(a); and
d)d) the buyer for all costs and charges related to providing assistance in obtaining documents and information in accordance with B7(a).
B9 ALLOCATION OF COSTS
The buyer must pay:
a) all costs relating to the goods from the time they have been delivered under A2, other than those payable by the seller under A9;
b)the seller for all costs and charges related to providing assistance in obtaining documents and information in accordance with A4, A5, A6 and A7(b);
c)where applicable, duties, taxes and any other costs related to transit or import clearance under B7(b); and
d) any additional costs incurred, either because:
(i)the buyer fails to nominate a carrier or another person under B10, or
(ii)the carrier or person nominated by the buyer under B10 fails to take the goods into its charge.
provided that the goods have been clearly identified as the contract goods.
The seller must give the buyer sufficient notice either that the goods have been delivered in accordance with A2 or that the carrier or another person nominated by the buyer has failed to take the goods within the time agreed.
The buyer must notify the seller of
a) the name of the carrier or another person nominated within sufficient time as to enable the seller to deliver the goods in accordance with A2;
b) the selected time, if any, within the period agreed for delivery when the carrier or person nominated will receive the goods;
c) the mode of transport to be used by the carrier or the person nominated including any transport-related security requirements; and
d) the point where the goods will be received within the named place of delivery.