FCA Explained: Free Carrier Delivery Term
FCA (Free Carrier) is the Incoterms 2020 delivery term where the seller delivers goods to the buyer's carrier at a named place, having cleared export customs. FCA works for all transport modes and is the ICC's recommended alternative to FOB and EXW.
What Is FCA?
FCA (Free Carrier) is an Incoterms 2020 delivery term where the seller delivers goods, cleared for export, to the buyer's designated carrier at a named place. FCA works for all transport modes (road, sea, air, rail, multimodal) and is the ICC's recommended term for most international trade scenarios.
FCA has two variants: delivery at the seller's premises (seller loads) or delivery at another place (goods placed at the carrier's disposal without unloading from the seller's vehicle).
FCA vs FOB
| Criteria | FCA | FOB |
|---|---|---|
| Transport mode | All modes | Sea only |
| Delivery point | Named place (warehouse, terminal) | Ship's rail |
| Risk transfer | Carrier receipt | On board vessel |
| B/L option | Added in 2020 | Standard |
The ICC recommends FCA for containerized cargo because containers are handed to the carrier at the terminal before vessel loading, making FCA's risk transfer point more accurate.
Responsibility Split
| Task | Seller | Buyer |
|---|---|---|
| Export customs | Yes | |
| Delivery to carrier | Yes | |
| Main transport | Yes | |
| Insurance | Yes | |
| Import customs | Yes |
When to Use FCA
- Road freight (instead of FOB)
- Containerized ocean freight (instead of FOB)
- When buyer wants to arrange main transport
- Multimodal transport
Frequently Asked Questions
Why does the ICC recommend FCA over FOB?
In container shipping, goods are handed to the carrier at the terminal before vessel loading. FCA's risk transfer at carrier receipt is more accurate than FOB's ship's rail.
Can FCA replace EXW?
Yes. FCA places export customs on the seller (practical) while EXW places it on the buyer (impractical internationally). FCA is the better choice.
Who chooses the carrier under FCA?
The buyer selects the carrier and informs the seller. The seller delivers goods to this carrier.
Does FCA include loading at seller's premises?
If delivery is at the seller's premises, yes. If delivery is at another place, the seller is not responsible for unloading from their vehicle.
References
- ICC Incoterms 2020
- UNCTAD Trade Facilitation
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