If you're involved in international trade, you may have come across the term "Free Alongside Ship (FAS)." This term is one of the widely accepted Incoterms, which are a set of standardized trading terms created by the International Chamber of Commerce (ICC). In this post, we'll dive into the world of FAS and explore what it means for shippers and traders.
In simple terms, FAS means that the seller is responsible for delivering the goods alongside the ship at a named port of shipment. The buyer takes over the responsibility and costs associated with loading the goods onto the vessel. From that point onwards, the buyer is responsible for all risks associated with transportation.
Under FAS, the seller arranges for transportation to bring the goods alongside the ship at a named port of shipment. The buyer is then responsible for loading the goods onto the vessel. Once loaded, all risks associated with transportation pass from the seller to the buyer.
Advantages of using FAS include reduced shipping costs and increased control over shipment. However, there are also some significant disadvantages to bear in mind, including a lack of control over transportation and potential liability issues.
FAS can be useful for both exporters and importers. Exporters can use FAS to ensure that their goods are delivered alongside the ship at a named port of shipment. This helps to ensure that their goods are shipped safely and securely. Importers can use FAS to take control over loading their goods onto vessels, which can help reduce costs associated with shipping.
While FAS is just one of many Incoterms, it has distinct differences from some of the other terms. For example, FOB (Free on Board) means that the seller is responsible for delivering the goods onto the vessel, while CIF (Cost, Insurance and Freight) means that the seller is responsible for delivering the goods to a named port of destination.
Both buyers and sellers can benefit from using FAS. Sellers can reduce their transportation costs by delivering the goods alongside the ship, while buyers can take control over loading their goods onto vessels and potentially reduce shipping costs.
In conclusion, Free Alongside Ship (FAS) is a useful Incoterm for both shippers and traders involved in international trade. By understanding how FAS works, its advantages and disadvantages, and its relationship to other Incoterms, you can make informed decisions about whether it's right for your business.
