ICC recommends FCA instead of FOB in containerized shipments. But why?

FOB (Free on Board) and FCA (Free Carrier) are two well-known and frequently used trade terms of Incoterms 2010.

Both FOB anf FCA have been in circulation for a long period of time, as they been defined under previous versions of Incoterms.

FOB is one of the oldest incoterms, which has been created in 1923. FCA introduced to the export-import world in 1980.

ICC recommends FCA instead of FOB in containerized shipments.

ICC included a warning message in Incoterms 2010, which catches the most practitioners by surprise.

One of the explanatory paragraphs under the FOB rule states that:

FOB may not be appropriate where goods are handed over to the carrier before they are on board the vessel, for example goods in containers, which are typically delivered at a terminal. In such situations, the FCA rule should be used.

Is it possible to use FOB incoterms with land and or air shipments?

The aim of the international commercial terms, known as incoterms, is to create a set of international standard rules for the application of the most commonly used trade terms in foreign trade.

Incoterms can only achieve its goal if it could reduce or eliminate the uncertainties of different interpretations of such terms in different countries.

ICC, International Chamber of Commerce, published latest version of international trade terms rules, which is known as Incoterms 2010. 

Incoterms 2010 rules define 11 different trade terms.

FOB, Free on Board, trade term is one of the most frequently used incoterms along with CIF and Ex Works. 

As a result every exporter or importer must understand these trade terms very well.