What is FCA in Shipping? A Complete Guide with Examples

What Is Free Carrier (FCA)?

Free Carrier (FCA) is one of the 11 Incoterms® rules set by the International Chamber of Commerce (ICC). It is widely used in international trade. Under FCA terms, the seller completes their duty when the goods are handed over to the carrier (or another person chosen by the buyer) at an agreed location. This location is usually in the seller’s country. At that moment, the risk of loss or damage passes to the buyer.
In an FCA deal, the seller takes care of export clearance, packing, and transport up to the named delivery point. The buyer handles the main transport and everything after that. The buyer also pays for it. The carrier can be by truck, rail, air, or sea—it depends on what the buyer needs.

Key Takeaways

• Seller manages export clearance, packing, and transport to the agreed place.
• Risk shifts when goods are given to the carrier—the seller does not need to unload them.
• Works for all types of transport (road, rail, air, sea); buyer picks the carrier and place.
• Seller gives proof of delivery; often used in global sales contracts.

How Free Carrier (FCA) Works

With FCA terms, the process starts when the seller prepares the goods and moves them to a pre-agreed spot. This spot could be a terminal, warehouse, or a third-party logistics site in the country of origin.
Once the goods reach that spot and are handed to the buyer’s chosen carrier, the seller’s job is done. All further costs and risks—like loading onto trucks or planes and the main transport—become the buyer’s responsibility. This setup works well when buyers want more control over shipping or prefer their own freight forwarders.

Important

• Clearly state the exact delivery point in the contract to prevent disputes (e.g., “FCA Seller’s Warehouse” or “FCA Port Terminal”).
• Seller is not responsible for delays after handover; buyer deals with import clearance and duties.
• Great for containerized or multimodal shipments; tracking is done via bill of lading or airway bill.

FCA is especially helpful for containerized or multimodal shipments in global sales. It gives buyers more options. At the same time, sellers avoid responsibilities outside their own country. For Amazon sellers using sourcing agents like X Sourcing, this clear split helps move goods smoothly from Chinese suppliers to FBA centers overseas.

FCA Incoterms

The Free Carrier (FCA) rule was added in 1990 by the International Chamber of Commerce. It replaced older terms that did not fit non-sea transport well. It is still a key part of Incoterms 2020—the current ICC version.
Incoterms help standardize trade rules worldwide. They define where delivery happens, when risk moves from seller to buyer, and who pays for which shipping costs.

Fast Fact

• Added in Incoterms 1990 to support non-sea transport better.
• Used in over 40% of global contracts, according to ICC data; brings clear roles for buyer and seller.
• Two options: FCA (named place with seller’s carrier) or FCA (named place only, buyer supplies carrier).

The 2020 update kept FCA mostly the same. It only clarified rules about bills of lading with onboard notes—a common need in ocean shipping.

Example of FCA

Here is a real-world example of how FCA works:

• Susan (seller in Germany) sells machines to Bob (buyer in the U.S.). The contract says “FCA Frankfurt Airport Terminal.”
• Susan packs the goods, arranges pre-carriage insurance, clears German export customs, and delivers them to Bob’s chosen airline carrier at the terminal.
• The carrier loads the goods. Risk and costs now belong to Bob. Susan gives him proof of delivery.
• Bob pays for air freight and U.S. import duties. The goods arrive without issues.

This case shows how FCA keeps the seller’s duties limited while letting the buyer manage the main shipping.

What Is the Difference Between FCA and FOB?

Both FCA and FOB (Free On Board) set points for risk and cost transfer. However, they differ in important ways:

• FCA: Works for any transport mode; seller hands goods to carrier (no need to load onto ship); buyer handles container loading.
• FOB: Only for sea or inland waterway; seller loads goods onto the ship at port; often manages export clearance.
• Risk transfer: FCA at carrier handover (can be inland); FOB when goods pass the ship’s rail.
• Current trend: FCA is preferred over FOB for containers (avoids old “rail” rule); FOB can be riskier for sellers.

FOB has drawbacks in modern container shipping because sellers often cannot control loading at crowded ports. As a result, many supply chains using air or multimodal transport now choose FCA.

What Is the Difference Between FCA and DDP?

FCA gives the seller very few obligations. DDP (Delivered Duty Paid) gives the seller the most responsibility:

• FCA: Seller’s risk ends at local carrier; buyer pays main transport and import costs.
• DDP: Seller covers all risks and costs until goods reach the buyer’s door (including import duties and full insurance).
• Workload: FCA puts more on the buyer for logistics; DDP puts more on the seller, but the buyer gets simpler delivery (often at higher price).
• Best for: FCA suits experienced importers; DDP helps beginners who want full-service shipping.

For sellers using agents like X Sourcing that provide complete procurement and shipping help, DDP can be better if clients have little logistics experience.

Who Pays for FCA Shipping?

Under FCA, costs are divided step by step:

• Transport to the named place: Seller pays (built into the goods price).
• Main transport from that point onward: Buyer pays (buyer chooses and pays the carrier).
• Loading/unloading at handover: Buyer (handled by the carrier they hired).
• Insurance: Optional; buyer usually arranges it after risk transfer, often under Institute Cargo Clauses.

This split lets sellers offer competitive prices. Buyers can pick cheaper or preferred shipping options.

Who Is Responsible for Export Clearance Under FCA?

The seller normally handles export clearance in FCA:

• Seller: Gets export license, files customs forms, pays origin-country duties/taxes, and arranges transport to the named place.
• Buyer: Manages import clearance, pays destination duties/taxes, and handles onward transport and documents.
• Proof: Seller provides export papers (e.g., commercial invoice, packing list); buyer receives transport documents.
• Exceptions: Seller may help with extra tasks if buyer asks, but at buyer’s expense and risk.

Amazon sellers working with services like X Sourcing gain from expert help on customs paperwork and export licenses. This ensures smooth border crossings.

The Bottom Line

Seller’s Responsibilities:

• Prepare goods for export: Commercial invoice, proper packing, labels/marks, quality certificates.
• Before shipment: Inland transport, loading (if agreed), export clearance and licenses.
• Provide proof of delivery to carrier at the named place.

X Sourcing makes sure all products are packed and secured to FBA standards, meeting these seller duties under FCA.

Buyer’s Responsibilities:

• Pay for goods as per contract.
• Arrange main transport contract, import clearance/duties/taxes, unloading, and final delivery.
• Inform seller about carrier details (at least 10 days ahead, as per Incoterms).

In fast-moving markets like Amazon FBA, where timing matters, clear Incoterms like FCA help sellers stay compliant. They also give buyers flexibility and cost savings. For sourcing agents like X Sourcing that manage everything from product development to FBA delivery, knowing these terms is key to smooth supply chain work.

FAQ

Q: What does FCA stand for in shipping terms?

A: FCA stands for Free Carrier, an Incoterms® rule where the seller delivers goods to the buyer’s chosen carrier at an agreed place. The seller handles export clearance, while the buyer manages the rest of the transport.

Q: Who is responsible for export clearance under FCA shipping terms?

A: The seller handles export clearance, including customs paperwork, duties, and documents in the country of origin.

Q: What is the main difference between FCA and FOB shipping terms?

A: With FCA, risk transfers when goods are handed to the carrier (any mode, often inland). With FOB, it is only for sea/inland waterway and transfers when goods are loaded on board the vessel.

Q: Who pays for the main freight under FCA shipping terms?

A: The buyer pays for the main transport, insurance, and all costs/risks after goods are handed to their chosen carrier.