FAS vs CFR – who pays for what?
FAS is Free Alongside Ship and CFR is Cost and Freight. We compare who pays for transport, customs clearance and duty, and where risk passes to the buyer.
Key differences
Under CFR, the seller also covers loading for main carriage and the main freight. Under FAS, the buyer pays for this instead. The two rules also differ in the point at which risk passes to the buyer.
- Loading for main carriage
- FASBuyerCFRSeller
- Main carriage (freight)
- FASBuyerCFRSeller
- Risk passes
- FASAlongside the ship at the port of loadingCFROn board the vessel at the port of loading
Full cost breakdown
| Cost | FAS | CFR |
|---|---|---|
| Export clearance | Seller | Seller |
| Transport to the port or terminal | Seller | Seller |
| Loading for main carriage | Buyer | Seller |
| Main carriage (freight) | Buyer | Seller |
| Insurance | No obligation | No obligation |
| Unloading at destination | Buyer | Buyer |
| Import clearance | Buyer | Buyer |
| Import duty and VAT | Buyer | Buyer |
| Risk passes | At the port of loading, when the goods are placed alongside the ship (e.g. on the quay). | At the port of loading, when the goods are on board the vessel – even though the seller pays the freight to the port of destination. |
| Mode of transport | Sea and inland waterway transport only | Sea and inland waterway transport only |
Notes
- CFR and CIF – the main freight ends at the port of destination. Transport from the port to the warehouse is paid by the buyer, while under the D rules (DAP, DPU, DDP) this leg is the seller’s responsibility if the place of delivery is a warehouse.
- Unloading at destination: if unloading costs are included in the contract of carriage concluded by the seller, the seller pays them and cannot charge them to the buyer afterwards.
What to watch for when importing from China
FAS Free Alongside Ship
FAS is hardly ever used for containers, because a container is handed over at the terminal several days before loading. It makes sense for bulk and oversized cargo – for containers, FCA is the better choice.
CFR Cost and Freight
The supplier pays the freight, but the risk passes to you as early as the port of loading in China. You usually pay the charges at the port of destination (e.g. for container handling at the terminal and the release of documents), and they are set by the forwarder chosen by the supplier – you do not know them in advance. Before you place the order, ask for a list of these charges.
When to use FAS and when to use CFR?
- FAS – for bulk and oversized cargo in sea freight, when the buyer arranges loading on board.
- CFR – for sea freight, when the supplier has a good freight rate to Europe, while you insure the goods yourself and handle customs clearance in Poland.
Buying on FAS terms? You choose the forwarder
We organise transport from China – by rail, sea or air – together with customs clearance in Poland and cargo insurance. Send us your cargo details and we will prepare a quote tailored to your shipment.
Request a quoteFAQ
What is the main difference between FAS and CFR?
Under CFR, the seller also covers loading for main carriage and the main freight. Under FAS, the buyer pays for this instead. The two rules also differ in the point at which risk passes to the buyer.
Where does risk pass to the buyer under FAS?
At the port of loading, when the goods are placed alongside the ship (e.g. on the quay).
Where does risk pass to the buyer under CFR?
At the port of loading, when the goods are on board the vessel – even though the seller pays the freight to the port of destination.
Can FAS and CFR be used for rail freight from China?
No. FAS and CFR apply only to sea and inland waterway transport. For rail or air freight from China, the rules for any mode of transport are used instead – e.g. FCA, CPT or CIP.
Compare other pairs
Incoterms® is a registered trademark of the International Chamber of Commerce (ICC). This page is an independent, simplified summary of how costs and risks are divided – it is not affiliated with or approved by the ICC. When drafting contracts, use the official text of the Incoterms® 2020 rules published by the ICC.