|
Comparison Aspect |
EXW (Ex Works) |
FOB (Free on Board) |
|
Core Responsibility |
Seller only delivers goods at their factory/warehouse; no obligation for transport, insurance, or export procedures. |
Seller arranges delivery to the port of shipment, loads goods onto the vessel, and pays pre-shipment costs; assumes risk until goods pass the ship’s rail. |
|
Risk Transfer |
Risk transfers to the buyer immediately upon delivery at the factory/warehouse. |
Risk transfers to the buyer once goods cross the ship’s rail at the port of shipment. |
|
Cost Responsibility |
Buyer bears all costs: transport, insurance, export/import customs, and taxes. |
Seller pays: - Domestic transport to the port - Loading fees, export taxes Buyer pays: - International freight, insurance - Import customs and taxes. |
|
Export Procedures |
Seller has no duty to handle export clearance (buyer manages it). |
Seller must complete export customs and provide documents (e.g., bill of lading, packing list). |
|
Applicable Transport |
Any mode (e.g., road, air). |
Only for sea or inland waterway transport. |
|
Common Scenarios |
Buyer is familiar with the exporter’s country processes or wants full control of logistics (e.g., local sourcing). |
Buyer prefers the seller to handle export formalities, or goods are transported via sea (e.g., bulk commodities). |
A Chinese manufacturer (seller) delivers goods to a French importer (buyer) at their Shenzhen factory. The buyer arranges truck transport to Hong Kong port, pays international freight and insurance, and assumes risk of damage during transit.
A Chinese exporter (seller) transports goods to Shanghai port, loads them onto a ship, and pays loading fees and export duties. If goods are damaged by a storm en route, the buyer bears the loss (risk transferred after crossing the ship’s rail).
