FAS
Also known as: Free Alongside Ship
FAS, Free Alongside Ship, means the seller delivers the goods, export-cleared, alongside the ship at the port of shipment. From that moment costs and risk are for the buyer. FAS applies only to sea and inland waterway.
Who arranges what under FAS?
The seller brings the goods to the quay or the lighter beside the ship the buyer has nominated, and files the export declaration. The buyer arranges loading, the sea carriage, the insurance and the import. The seller has delivered alongside; everything from the hook or the grab is for the buyer. The buyer must give the ship and the loading place in good time. If they do not, the risk still passes on the agreed date. The goods then stand on someone else's quay, and who pays storage, watching and demurrage in that period is a question FAS itself does not answer. FAS is one of the four terms that apply only to sea and inland waterway. For air, road, rail and containers it is unusable. The goods must actually be able to stand beside a ship. A container handed in at the terminal does not stand alongside the ship, and FCA belongs there.
Where does the risk pass under FAS?
As soon as the goods stand alongside the ship, so before loading. Damage during loading is for the buyer's account. That makes FAS the sea variant with the earliest risk point of the four, still before FOB, where the risk only passes once the goods are on board. Alongside is a physical point: the quay, the lighter, the spot next to the berth. It is not terminal receipt and not gate-in. Anyone writing FAS for a container move is fixing a transfer point that does not exist in the operation, and gets a dispute as soon as something happens between gate-in and loading. Name the port and if possible the quay or berth. FAS Rotterdam leaves open where the goods must stand. FAS Rotterdam, quay [name], alongside [ship] on [date] is a transfer point you can point to at a loss. Without that precision alongside is a word, not a place.
When do you use FAS?
FAS fits bulk goods and project cargo that do not go in containers, such as grain, ore, timber, steel or heavy construction parts. There the quay is a logical transfer point: the seller brings the cargo to beside the ship, the buyer loads with their own or chartered gear. At a grain elevator or a heavy crane that is the practice. For containers FAS is unsuitable: the container is handed in at the terminal and not placed beside the ship. FCA fits better there, with the risk point at the carrier or the terminal. FOB is already too late for containers, FAS even more so. FAS is rare, and that is right. Use it only if the cargo is actually placed alongside a ship and the buyer organises the loading themselves. In every other case FCA (multimodal) or FOB (on board, seller loads) is the term that matches the operation.
What does FAS mean for the customs value?
The FAS price stops alongside the ship at the port of shipment. On import into the EU the loading, the sea freight and the insurance to the external border must therefore be added. Port costs in the country of export after alongside belong there too, to the extent the buyer bears them. On bulk cargo that is a substantial amount that differs per voyage. The declarant needs the freight invoice or the charter-party amount for it; an estimate is not allowed if the actual costs are known or can be known. A voyage charter often names a lump sum, and that lump sum belongs in the customs value to the EU border. On the import declaration the named place is the port of shipment, in the country of export. FAS Shanghai on a shipment to Rotterdam means a place outside the EU and an add-back of loading plus sea voyage plus insurance. Without those papers in the file the IMA cannot be supported.
What do you watch under FAS in practice?
Name the port and if possible the quay or berth. FAS Rotterdam leaves open where the goods must stand, which on bulk and project cargo leads to waiting time and argument. The buyer must give ship, quay and loading window in good time, otherwise the risk passes while the cargo is not yet beside the right ship. Also agree what happens if the ship is late or does not come. Under FAS the risk passes on the agreed date if the buyer does not nominate their ship in time, but the goods then stand on someone else's quay. Who pays storage, watching and insurance in that period belongs in the contract and should not be fought out afterwards. Record who files the export declaration (the seller) and which papers they supply and when. The buyer cannot load unless the cargo has been export-cleared. An FAS shipment that stands alongside without an MRN of the export does not go on the ship, and the laytime still runs.
How does FAS appear on the import declaration?
On the import declaration you enter FAS as the delivery term, with the port of shipment. That port lies in the country of export. Customs reads from that that the invoice price stops alongside the ship, and that loading, sea freight and insurance to the EU border still have to be added. Collect the papers with the file: commercial invoice FAS, loading costs, freight invoice or charter party, insurance to the EU border. On bulk the freight is often a lump sum per voyage. That lump sum to the port of destination in the EU may be split into the part to the external border and the part after only if that split appears. Otherwise the whole amount stays in the value. FAS is not FOB. The difference is the loading. If you put FOB on the declaration while the invoice says FAS, the loading is in the price according to the declaration and not according to the invoice. The customs value is then wrong on one of the two sides. The three-letter code must match the one on the invoice.
Which documents and pitfalls belong with FAS?
The seller supplies invoice, packing list, export declaration and proof that the goods stand alongside, for example a dock receipt or a mate's receipt before loading. The buyer has the charter or the booking, the loading instruction, the freight invoice and later the import documents. A bill of lading only arises at loading, so after the FAS transfer. The first pitfall is using FAS for containers. The second is not nominating the ship or the quay in time, so the risk passes while the cargo stands in the wrong place. The third is no agreement on storage if the ship is later, so the seller bears costs for a risk that already sat with the buyer. Use FAS only on bulk and project cargo that is actually placed beside a ship. For the rest of sea freight FOB (seller loads, risk on board) or FCA (containers, risk at the carrier) is the term that follows the operation. A term that describes a quay the cargo never reaches is unusable at the first loss.