FOB Contract Quiz

What does FOB stand for?

• Free Of Burden

• Freight On Board

• Free On Board

• Freight Of Business

In an FOB contract, who bears the cost of shipping?

• The buyer

• The seller

• The shipping company

• Both parties equally

What happens to the risk of goods in an FOB contract when they are loaded onto the ship?

• It is transferred to the shipping company

• It is shared between buyer and seller

• It passes to the buyer

• It remains with the seller

In the case of Cowasjee v Thompson, what was concluded about the delivery of goods?

• Delivery is complete when goods are shipped

• Delivery is complete when goods are paid for

• Delivery is complete when goods are received by the buyer

• Delivery is complete when the bill of lading is issued

What is a key characteristic of a strict FOB contract?

• The seller bears all shipping costs

• The buyer is the legal shipper from the start

• The seller nominates the vessel

• The buyer has no responsibilities

In an extended FOB contract, who typically has better local knowledge?

• The buyer

• The customs officer

• The seller

• The shipping agent

What must the buyer do in an FOB contract regarding the vessel?

• Pay for the vessel's maintenance

• Nominate the vessel to be used

• Provide insurance for the vessel

• Select the shipping company

What is the seller's duty regarding the goods in an FOB contract?

• To deliver goods that conform to the contract

• To insure the goods

• To pay for the buyer's import license

• To arrange for customs clearance

What does the buyer need to obtain for importing goods?

• Shipping license

• Import license

• Export license

• Customs clearance

In which case was it held that the buyer must nominate a suitable vessel?

• Cowasjee v Thompson

• Wimble v Rosenberg

• Bunge Corporation v Tradex Export

• Stock v Inglis