The Study On Usage Of FOB

Trade terms are products of certain historical stage. As the development of international trade,transport and communication ,more and more trade terms are used in business. As to trade terms, FOB is one of the most important international trade terms. According to the statistical investigations study by International Chamber of Commerce at the end of 90's more than 40 countries, FOB is used most frequently. Despite the increasing variety of terms of trade, FOB is still the core of International Sale of Goods Act. There are two Practices interpret FOB trade terms, including《INCOTERMS 2000》and《Revised American Foreign Trade Definition 1941》.In particular, we use FOB contract usually when we export or import the special cargo like the large amount solid stuff or the petroleum and so on. Most of export trade in our country, the exporter is not willing to deal with the shipping. In addition, under buyer's market circumstances, considering the convenience, the exporter are inclined to use FOB in foreign trade.Previously, the majority believes that the risk of FOB trade term is small. However, in practical application, there are numerous risks that the exporter cannot be overlooked. In market activity, the trade is accompanied with the risks. However, in recent years, the risk increased when use FOB contract to export. In 2000 the national department of commercial affairs sends the notices many times, requests the export unit to sign the CIF contract as far as possible. But as the main international trade terminology, FOB is impossible in the practice to abandon. Especially when involves the large amount cargo and the petroleum transport, or the cargo has the special size, which needs the buyer voluntarily to arrange the transportation in the situation, the usage of FOB is quite frequent. Therefore we should solve the problems, but not to avoid. It is essential to study some feasible countermeasures on the present question, in order to reduce the risks in maximum.There are many risks under the FOB contract, including bill of lading, foreign exchange, insurance and transport. This article provides a summary analysis of these risks and makes the corresponding responses. In order to study the risks and give the countermeasure, this thesis mainly compares the different FOB convention and the definitions of different country. In addition, this paper pays much attention to the problems that will occur frequently and affect the trade when exporting under FOB contract. When using FOB contract, we should prevent the risks before they occur. This is also precisely an urgent matter, which our exportation enterprise should face in our country. Through anglicizing the case, it is proved that the FOB contract certainly does not need completely to abandon so long as take the suitable actions. The risk is objective, but the risk also can avoid. The key point of this article is to introduce the risk which is caused by the No-Bill Delivery under Straight Bill of Lading in FOB terms,and by the different forms of payment like L/C and D/P .This article also pay much attention on the non- ship carrier question that appears frequently at present when choosing FOB contract to export.In the practice, although there are risks, we still need FOB contract. In order to reduce the risks, under teacher's instruction, the author read and studies the related material and the books. For this question, I proposed my own viewpoint and the view. The aim of this paper is to propose some serviceable solution and countermeasures when using FOB contract, for the foreign trade enterprises that are under the difficult position in our country.