Logistics Glossary

Get to know the vital terms of Logistics and Supply Chain Management.

FAS (Free Alongside Ship)

What Does FAS Mean in Shipping?

FAS, which stands for “Free Alongside Ship,” is one of the primary terms adopted globally in trading and shipping. This is a form of agreement whereby the seller delivers the goods against the ship at a respective port. Once the goods are placed alongside the ship at the pier or dock, the risk, cost, and responsibility shift to the buyer.

Primary Characteristics of FAS

Seller’s Responsibilities

Under FAS terms, the seller is responsible for transporting the goods to the port of shipment, making sure they are placed on the dock beside the vessel. All logistics-export documents, packaging, and shipping to the port are dealt with by the seller.

Buyer Takes Over at Dockside

When the goods are released by the ship side, it passes to the buyer. The buyer then obligates himself to load the goods in the vessel while taking care of the freight charges, insurance cover, and risk of loss or damage that may be incurred subsequent to that.

Best Implemented in Marine Transport

The FAS is primarily implemented in marine or inland water transport. This mode is best suited for bulk shipments, heavy machinery, and other bulky goods that require specialized handling at the port of loading.

How FAS Works

A US Company sells machinery to a Japanese Purchaser. The seller ships the machinery from a mutually agreed US-based port and places the machinery alongside the ship on the dock. At this point, the Japanese Buyer shall load the machinery into the vessel and incur all further transportation costs like sea freight and insurance.

Conclusion

FAS is one of the most fundamental international shipping terms that define the division of responsibility between a seller and buyer. In any such sale, when the seller gets the goods to the dock, the buyer is responsible for everything from the dock to the final destination. Thus, the term helps clarify international trade and smoothen the logistics of movements in overseas shipments.

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