What does FOB mean under Incoterms 2020 for a Thailand export?
Under Incoterms 2020, FOB (Free On Board) means the seller delivers the goods on board the vessel nominated by the buyer at the named port of shipment — for a Thailand export, a Thai port such as Laem Chabang or Bangkok. Risk and cost transfer from seller to buyer once the goods are on board: the seller handles export clearance and getting the goods on the ship; the buyer arranges and pays for ocean freight, insurance, and import.
FOB is one of the most-used Incoterms for sea freight. It draws a clean line at the ship: everything up to and including loading on board is the seller's responsibility and cost; everything after is the buyer's.
Who does what under FOB
| Responsibility | Seller (Thai exporter) | Buyer |
|---|---|---|
| Export clearance | Yes | No |
| Delivery to port + loading on board | Yes | No |
| Ocean freight | No | Yes |
| Marine insurance | No | Yes (recommended) |
| Import clearance + duties | No | Yes |
Where risk transfers
Risk of loss or damage passes when the goods are placed on board the vessel at the named Thai port. FOB is only appropriate for sea or inland-waterway transport; for containerised cargo handed over at a terminal before loading, FCA is often the more accurate term. FOB governs delivery, risk, and cost only — it does not transfer title, which is set by the contract.
Frequently asked questions
Often not. FOB assumes goods are loaded on board; for containers delivered to a terminal beforehand, FCA (Free Carrier) more accurately reflects where the seller's responsibility ends.
No. Under FOB the buyer arranges and pays for marine insurance, since risk transfers once the goods are on board.