Economics · Incoterms and Risk Transfer (FOB)
Under the Free On Board (FOB) Incoterm, who bears the liability for goods damaged during transit after shipment?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Liability is automatically shared equally between buyer and seller if damage is caused by natural forces.
- 2Risk passes only when the buyer has had an opportunity to physically inspect the goods at destination.
- 3The buyer is liable because risk transfers to the buyer once the goods are loaded on board the vessel at the port of shipment.✓
- 4The seller is liable because damage occurred before arrival at the buyer's warehouse.
Correct answer
The buyer is liable because risk transfers to the buyer once the goods are loaded on board the vessel at the port of shipment.
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