FCA Incoterm (Free Carrier) – Definition

FCA (Free Carrier) is one of the Incoterms 2020 rules that can be used with any mode of transport, including multimodal shipments. The seller fulfils its obligation when the goods are handed over—loaded if the named place is the seller’s premises, or placed at the carrier’s disposal if elsewhere—to the carrier or another party nominated by the buyer at the named place of delivery. From that moment, risk transfers to the buyer.

2020 update: Article A6/B6 now lets the parties agree that the buyer instructs the carrier to issue an on‑board bill of lading to the seller once the goods are loaded, making FCA more attractive for letter‑of‑credit trades. 

Seller’s Main Obligations (FCA)

• Issue the commercial invoice and packing list.
• Clear the goods for export and bear all export duties, taxes, and formalities.
• Load the goods on the buyer‑nominated vehicle if the named place is the seller’s facility; otherwise, place them ready for pickup at the agreed point.
• Provide the buyer with the transport document (B/L, AWB, CMR) showing “FCA, [Named Place], Incoterms 2020.”
• Notify the buyer that delivery has occurred.
• Bear risk and costs up to the hand‑over point.

Buyer’s Main Obligations (FCA)

• Pay for the goods as set out in the sales contract.
• Arrange and pay for the main carriage, choosing and instructing the carrier.
• Handle transit and import customs clearance, duties, VAT, and any local taxes.
• Organise on‑carriage from the named place to the final destination.
• Obtain cargo insurance for the legs under its risk (optional but strongly recommended).

Insurance Under FCA

Incoterms impose no mandatory cargo‑insurance requirement.

A clearly drafted sales contract should spell out who buys which policy to avoid gaps. (Trade Finance Global)

FCA Compared with Related Terms

*If the named FCA place is not the seller’s premises, loading/unloading is for the party that contracts the carrier.

When Does FCA Make Sense?

• Container exports where the buyer wants to leverage its own freight contracts.
• Intermodal projects (rail + sea + truck) needing a clean risk cut‑off at origin.
• Situations where banks require an on‑board B/L but physical loading happens inland.
• Deliveries from large exporters whose sites can safely load trucks or containers.

Common Pitfalls & Mitigation

Required Documents at a Glance

• Commercial Invoice & Packing List
• Export customs declaration and licences/certificates of origin or conformity
• Bill of Lading / Air Waybill / CMR marked “FCA [Named Place] Incoterms 2020”
• Any agreed insurance certificate or carrier instructions

Key Takeaways

1. Risk passes under FCA when the goods are handed over to the buyer’s carrier—loaded if at the seller’s premises.
2. The seller handles export clearance and origin loading; the buyer controls freight, transit, and import.
3. Clear contract wording on the exact delivery point, documentary requirements, and insurance split prevents costly disputes.
4. The new on‑board B/L option makes FCA a practical alternative to FOB for containerised sea shipments financed by L/Cs.