Learn what is FCA in shipping, how Free Carrier works under Incoterms, the detailed responsibilities of buyers and sellers, and how it impacts transportation, costs, and global logistics.
1.What is FCA in International Trade?
When businesses ask what is FCA, they want clarity on responsibilities in global transportation. FCA, or Free Carrier, is one of the most practical Incoterms in international trade.
Under FCA, the seller delivers goods, cleared for export, to the buyer’s nominated carrier at a named place. This delivery point could be:
- Seller’s warehouse
- A container terminal
- An airport cargo hub
- A rail station
The moment goods are handed over, risk transfers from seller to buyer. Unlike FOB (limited to sea freight), FCA is versatile. It applies to all modes of transportation—air, sea, road, or rail.
In modern supply chains where multimodal transport is common, knowing what is FCA helps companies avoid costly misunderstandings.
2.Seller’s Responsibilities Under FCA
Understanding what is FCA requires knowing the seller’s precise obligations before goods leave their country.
Seller must:
Prepare goods with export packaging suitable for international transit.
- Transport cargo to the agreed location (e.g., factory gate, airport, or terminal).
- Handle export customs clearance and obtain permits.
- Provide all shipping documents up to the handover point.
- Load goods onto the carrier’s truck, plane, or container if required.
Seller Task Table (FCA)
| Seller Responsibility | Description | Impact on Transportation |
|---|---|---|
| Inland haulage | Trucking goods to nominated delivery point | Ensures smooth transfer to main transport |
| Export clearance | Filing customs documentation | Prevents border rejections |
| Loading cargo | Ensures safe transfer to carrier | Minimizes damage risk |
| Documentation | Invoice, packing list, export permit | Required for onward transit |
Knowing what is FCA allows sellers to clearly define their endpoint, protecting them from liability beyond their own country.
3.Buyer’s Responsibilities Under FCA
When businesses research what is FCA, the buyer’s role is often the biggest concern. Once goods are delivered to the nominated carrier, the buyer assumes nearly full control of transportation.
Buyer duties include:
- Booking international freight (sea, air, or rail).
- Arranging insurance for cargo beyond the seller’s country.
- Import customs clearance at destination port or airport.
- Paying all duties, tariffs, and VAT.
- Handling final delivery to their own warehouse or customer.
Buyer Responsibility Checklist
✔ Choose carrier and transport mode
✔ Pay for freight beyond seller’s delivery point
✔ Manage insurance against transit risks
✔ Handle import customs formalities
✔ Arrange inland trucking or distribution
Without a strong logistics plan, buyers may struggle. That’s why fully understanding what is FCA is crucial before signing contracts.
4.FCA in Different Modes of Transportation
Since FCA works across all transport modes, here’s how it applies in practice:
1.Sea Freight:
Seller delivers container to port terminal; buyer arranges ocean freight.
2.Air Freight:
Seller trucks goods to airport cargo terminal; buyer books airline.
3.Rail Freight:
Seller delivers to rail terminal for cross-border movement.
4.Road Freight:
Seller hands over cargo to international trucking firm.
FCA vs Transportation Modes
| Mode | Seller Responsibility | Buyer Responsibility |
|---|---|---|
| Sea Freight | Truck goods to port terminal, clear export | Book vessel, pay freight, import clearance |
| Air Freight | Deliver cargo to airline cargo terminal | Pay for flight, customs, final trucking |
| Rail Freight | Deliver to train terminal | Manage cross-border rail freight |
| Road Freight | Load onto international truck | Handle import and final delivery |
5.Advantages of FCA in Transportation
Works for any transport mode, unlike FOB.
Seller responsibility ends at carrier handover.
Buyer negotiates freight rates directly.
Seller handles export, buyer handles import.
Buyers can select the most affordable carriers.
6.Disadvantages of FCA
Still, what is FCA has limitations:
❌ Buyers take on heavy responsibility for international logistics.
❌ Risk of poor coordination at delivery point.
❌ Costs may rise if buyers lack strong freight forwarders.
❌ Import duties and customs are entirely on the buyer.
7.Documentation Required Under FCA
One reason businesses want to know what is FCA is documentation. Smooth transportation depends on accurate paperwork.
Typical FCA documents include:
- Commercial Invoice
- Packing List
- Export Customs Declaration
- Certificate of Origin (if required)
- Bill of Lading or Air Waybill (issued after international leg begins)
Incorrect documentation can cause delays, so both parties must ensure paperwork aligns with FCA responsibilities.
8.FCA vs. Other Incoterms
When comparing what is FCA with FOB, EXW, and CIF, the difference is in responsibility transfer.
| Aspect | FCA | FOB | EXW | CIF |
|---|---|---|---|---|
| Delivery point | Flexible (factory, port, airport) | On vessel at port | Seller’s premises | Destination port |
| Transport modes | All | Sea only | All | Sea only |
| Export clearance | Seller | Seller | Buyer | Seller |
| Freight | Buyer | Buyer | Buyer | Seller |
| Insurance | Buyer | Buyer | Buyer | Seller |
FCA provides more flexibility than FOB, less risk than EXW, and more buyer control than CIF.
9.Risks & Insurance Under FCA
Another important aspect of what is FCA is risk transfer. Once the goods are with the carrier, all risks belong to the buyer.
Buyer risks include:
- Damage during ocean or air transport
- Loss in transit
- Port congestion delays
- Customs detention at destination
To mitigate risks, buyers should purchase Cargo Insurance (Institute Cargo Clauses A recommended).
10.Step-by-Step FCA Flow
| Step | Responsible Party | Action |
|---|---|---|
| 1 | Seller | Prepares cargo, packages for export |
| 2 | Seller | Trucks cargo to delivery location |
| 3 | Seller | Clears export customs |
| 4 | Seller | Loads cargo onto carrier |
| 5 | Buyer | Books main transport (ship, plane, rail) |
| 6 | Buyer | Pays for freight and insurance |
| 7 | Buyer | Handles import clearance |
| 8 | Buyer | Arranges inland delivery to warehouse |
This breakdown helps businesses asking what is FCA see the complete journey of goods.
Conclusion
In international trade, knowing what is FCA helps both sellers and buyers clearly define responsibilities. Sellers handle local delivery and export customs, while buyers take over main transportation and import clearance. Because FCA works for sea, air, rail, and road freight, it offers flexibility and reduces disputes. Simply put, what is FCA means balanced responsibility and smoother global shipping.
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FAQs
Q1:Who pays freight under FCA?
The buyer pays for international freight, insurance, import customs, and final delivery. The seller only pays for domestic transport to the delivery point and export clearance.
Q2:Can FCA be used for air freight?
Yes. FCA works for air, sea, rail, and road transport, making it more flexible than FOB, which only applies to sea freight.
Q3:What is FCA vs. FOB?
FOB applies only to sea shipments, with risk transferring when goods are loaded on the vessel. FCA allows risk transfer at any agreed location, including inland, airports, or terminals.
Q4:What is FCA vs. CIF?
In CIF, the seller pays for freight and insurance to the destination port. In FCA, the buyer arranges freight and insurance after goods are delivered to the carrier.
Q5:Does FCA include insurance?
No. Insurance is not mandatory under FCA. Buyers usually purchase cargo insurance after goods are handed to their nominated carrier.