Usually translated into Spanish as Free Carrier, in the FCA 2010 Incoterm, the seller makes the merchandise available to the buyer in the place agreed between both, and these may be the seller’s own facilities.
The latest update of the Incoterms has entered into force on January 1, 2020. In this article, we will tell you all the news of the Incoterms 2020.
As we have already said, the delivery will be made at the point agreed between the buyer and the seller and we will consider that it has occurred at different times depending on the place of delivery. If it is agreed that it will be delivered to the seller’s facilities, the latter must be in charge of loading it on the transport designated by the buyer. It will be at this time, with the merchandise loaded when the responsibility for it is transferred from one to another.
Incoterm FCA 2010 – Free Carrier (Free carrier, named place): considerations on its use
Given these conditions, it seems logical that the FCA 2010 Incoterm is replacing the use of the EXWorks Incoterm in many cases. The problem about who should load the merchandise and who will be responsible for this process by applying the EXWorks conditions to an operation are fully solved using an “FCA factory”.
But with this Incoterm we can also agree that the delivery takes place at another point to be agreed between both parties. In this case, the seller will transfer the merchandise to the designated place in due time and form, not proceeding to load it in the buyer’s transport or unload it from his own.
The seller will make the merchandise available to the buyer who must unload it from the buyer’s transport, contributing their own means for this operation.
The responsibility for the merchandise will be transferred at the moment in which the seller makes it available to the buyer at the indicated point without unloading it from its transport.
We must also consider that the seller will be the one who carries out the export clearance, solving the obtaining of licenses for it.
It can be used with any means of transport, so we will say that it is a multimodal Incoterm.
Seller’s obligations
With the use of this Incoterm, the seller must have the merchandise ready at the point agreed with the buyer in a timely manner. In the same way, it must assume the cargo operations if necessary according to the delivery point.
The merchandise must be correctly packed, so that it does not suffer damage during transport. We will pay special attention to packaging in the event that delivery occurs at our facilities and we are responsible for the cargo.
The seller must do the export clearance, as well as obtain any export license that is required, and will provide the buyer with the documentation related to the cargo.
Obligations of the buyer
The buyer will bear all expenses and responsibilities on the cargo from the moment the merchandise is received by its carrier. These expenses will include transportation, tariff expenses, airport or maritime handling expenses, obtaining documents and any other case that may be incurred.
How is the FCA 2010 Incoterm used?
As we have already seen in our introductory article to Incoterms 2010, there is a structure that we must follow when citing them and it is the following:
PRICE – INCOTERM – LOCATION – VERSION
In this case, for merchandise worth 7,500 euros that we are going to deliver under FCA conditions at our offices in Madrid, we will do so as follows:
€7,500 FCA MADRID ICC 2010 or also €7,500 FCA MADRID (FACTORY) ICC 2010
It may also be the case that the delivery occurs at a point agreed between both parties, such as the container terminal of the port of Alicante. In this case we will quote it as follows:
€7500 FCA ALICANTE (PORT CONTAINER YARD) ICC 2010
The more precise we are at this point, the better, providing data about the place of delivery or other things never hurts. This can save us problems in the future. We also recommend replacing the Incoterm EXWorks with FCA factory whenever possible, since in the latter the responsibilities for loading and unloading the goods are much clearer.
Incoterms 2020 Update: the new FCA
After 10 years, we continue to fight here and as usual, we have created the definitive guide on the 2020 incoterms, with more than 2000 words, on the newly revised FCA 2020 incoterm.