What is CFR trade?

Cost and freight (CFR) is a legal term used in foreign trade contracts. In a contract specifying that a sale is cost and freight, the seller is required to arrange for the carriage of goods by sea to a port of destination and provide the buyer with the documents necessary to obtain them from the carrier.

What is CFR Singapore?

The Cost and Freight (CFR) incoterms means the seller (exporter) is responsible for obtaining customs clearance to export the goods, delivering the goods on board the vessel at the port of shipment and paying international freight charges.

Who pays insurance in CFR?

Cost and freight (CFR) is a trade term that requires the seller to transport goods by sea to a required port. Cost, insurance, and freight (CIF) is what a seller pays to cover the cost of shipping, as well as the insurance to protect against the potential damage of loss to a buyer’s order.

Is CFR same as fob?

The primary difference between using cost and freight (CFR) and free on board (FOB) shipping lies in who must pay for various shipping or freight costs—the buyer or the seller. The terms also specify who is responsible for which costs. Both cost and freight and free on board are legal terms in international trade.

Who pays for insurance in CFR?

buyer
Insurance. As discussed above, the buyer pays for insurance in CFR. He’ll be liable for the goods right from the place of origin.

Which Incoterms are inappropriate for container goods?

Under the Incoterms® 2020 rules FOB is inappropriate for container shipments because the cargo is given to the carrier at a place some distance from the port, such as a container yard or even the seller’s premises. “Free on Board” has been in use since the sailing ship days.

When to use cost and freight (CFR) rules?

Cost and Freight (CFR) Use of this rule is restricted to goods transported by sea or inland waterway. In practice it should be used for situations where the seller has direct access to the vessel for loading, e.g. bulk cargos or non-containerised goods. For containerised goods, consider ‘Carriage Paid To CPT’ instead.

What is cost and freight in international trade?

Cost and freight (CFR) is a legal term used in foreign trade contracts. In a contract specifying that a sale is cost and freight, the seller is required to arrange for the carriage of goods by sea to a port of destination and provide the buyer with the documents necessary to obtain them from the carrier.

What are the 13 terms used in international trade?

13 International Trade Terms: EXW, CIF, FOB, CFR 1 FAS (Free Alongside Ship)* 2 CFR (Cost and Freight) 3 CIF (Cost, Insurance and Freight) 4 CPT (Carriage Paid To) 5 CIP (Carriage and Insurance Paid To) 6 DAF (Delivered At Frontier) 7 DES (Delivered Ex Ship) 8 DEQ (Delivered Ex Quay)* 9 DDP (Delivered Duty Paid) 10 DDU (Delivered Duty Unpaid)

Who pays for transportation in CFR trade?

For a CFR trade, the Exporter will arrange and pay for transportation to the destination port which is specified by the buyer. Furthermore, exporting company will arrange and fund the transportation that is set out by the purchasing party.