CFR - COST & FREIGHT

The use of this rule is restricted to merchandise transported by ocean or inland waterway.
In applying it ought to be used for things wherever the vendor has direct access to the vessel for loading, e.g. bulk cargos or non-containerized merchandise.


For containerized merchandise, think about ‘Carriage Paid To CPT’ instead.

The seller arranges and pays for transport to the named port. The vendor delivers merchandise, cleared for export, loaded on board the vessel.

 However, risk transfers from the vendor to the client once the products are   loaded on board, i.e. before the most carriage takes place.
 NB vendor isn't accountable for insuring the products for the most carriage.


  
Risk and price transfer from vendor to client at totally different points.


CFR Shipping Incoterms Obligations

Seller’s Obligations

  • Goods, industrial invoice and documentation
  • Export packaging and marking
  • Export licenses and customs formalities
  • Pre-carriage and delivery
  • Loading charges
  • Delivery at the named port of destination
  • Proof of delivery
  • Cost of pre-shipment scrutiny

Buyer’s Obligations

  • Payment for merchandise as per sales contract
  • Risk beginning with aboard delivery
  • Discharge and onward carriage
  • Import formalities and duties
  • Cost of pre-shipment scrutiny (for import clearance)