Export glossary – F

F.O.B. Freight Allowed The same as F.O.B. named inland carrier, except the buyer pays the freight charges of the inland carrier and the seller reduces the invoice by that amount.
F.O.B. Freight Prepaid The same as F.O.B. named inland carrier, except the seller pays the freight charges of the inland carrier.
F.O.B. Named Inland Carrier Seller must place the goods on the named carrier at the specified inland point and obtain a bill of lading. The buyer pays for the transportation.
F.O.B. Named Port Of Exportation Seller is responsible for placing the goods at a named point of exportation at the sellers expense. Some European buyers use this form when they actually mean F.O.B. vessel.
F.O.B. Vessel Seller is responsible for goods and preparation of export documentation until actually placed aboard the vessel.
Factoring Houses Certain companies which purchase international accounts receivable at a discount price, usually about two to four percent less than their face value. The fee charged the exporter is offset by the immediate availability of payment, plus the reduction in risk for the exporter.
Fair Trade These companies negotiate directly with the growers or producers of products to establish a fair price for the product. In commodities such as coffee, organizations have committed to paying a price and following procedures, which meet needs of the small growers even when the world market is below that price. Go to : http://www.fairtrade.org.za/ which is the umbrella organisation for fair trade in South Africa.
FAS Free alongside ship. A pricing term indicating that the quoted price includes the cost of delivering the goods alongside a designated vessel.
Fast Track A procedure adopted by the US Congress, at the request of the President, committing Congress to vote to pass or reject a trade agreement without amendment. Critics argue that this procedure is undemocratic because Congress members cannot amend or reject objectionable clauses before agreements are passed. Fast Track was first introduced in the Trade Act of 1974. See Trade Promotion Authority(TPA)
Fca “Free carrier” to named place. Replaces the former term “FOB named inland port” to designate the seller’s responsibility for the cost of loading goods at the named shipping point. May be used for multimodal transport, container stations, and any mode of transport, including air.
Fcia Foreign Credit Insurance Association.
Fdi Foreign Direct Investment is the purchase by the investors or corporations of one country of non-financial assets in another country. This involves a flow of capital from one country to another to build a factory, purchase a business or buy real estate.
Fi Free in. A pricing term indicating that the charterer of a vessel is responsible for the cost of loading and unloading goods from the vessel.
Financed Bills Bills sent on collection in which the remitting branch has a financial interest.
First In-First Out (Fifo) An accounting method based on an assumption regarding the flow of goods that older stock is disposed of first, in accordance with good merchandising policy.
Floating Policy See Open policy.
Fo – Free out. A pricing term indicating that the charterer of a vessel is responsible for the cost of loading goods from the vessel.
Fob “Free on board” at named port of export. A pricing term indicating that the quoted price covers all expenses up to and including delivery of goods upon an overseas vessel provided by or for the buyer.
Force Majeure The title of a standard clause in marine contracts exempting the parties for nonfulfillment of their obligations as a result of conditions beyond their control, such as earthquakes, floods, or war.
Foreign Bill Purchased (Fbp) A bill remitted to a correspondent bank in which the remitting branch is financing the exporter – see Financing Export Collections.
Foreign Exchange The currency or credit instruments of a foreign country. Also, transactions involving purchase or sale of currencies.
Foreign First (Fofi) An accounting method based on an assumption regarding the flow of goods that foreign status merchandise is disposed of first.
Foreign Freight Forwarder A corporation carrying on the business of forwarding who is not a shipper or consignee. The foreign freight forwarder receives compensation from the shipper for preparing documents and arranging various transactions related to the international distribution of goods. Also a brokerage fee may be paid to the forwarder from steamship lines if the forwarder performs at least two of the following services: (1) coordination of the movement of the cargo to shipside; (2) preparation and processing of the Ocean Bill of Lading; (3) preparation and processing of dock receipts or delivery orders; (4) preparation and processing of consular documents or export declarations; and (5) payment of the ocean freight charges on shipments.
Foreign Sales Agent An individual or firm that serves as the foreign representative of a domestic supplier and seeks sales abroad for the supplier.
Foreign Trade Zone See Free-trade zone.
Foreign Trade Zone Entry A form declaring goods which are brought duty-free into a Foreign Trade Zone for further processing or storage and subsequent exportation and/or consumption.
Forfaiting Forfaiting, similar to factoring, is an arrangement under which exporters actually forfeit their rights to future payment in return for immediate cash. The arrangement is commonly used for sales of capital equipment with terms of one-to-five years.
Foreign-Based Agent/Distributor An individual or firm serving as the foreign representative of U.S. suppliers, locating buyers for them in the foreign market.
Foreign-Trade Zones Board The Board which is established to carry out the provisions of the Foreign-Trade Zones Act.
Forward Exchange Contract Contract between the Bank and its customer to buy/sell a fixed amount of foreign currency at a future date at a specified rate. This could be for a customer to make payment under a DC or to sell the proceeds received from an export negotiation.
Foul Bill Of Lading A receipt for goods issued by a carrier with an indication that the goods were damaged when received. Compare Clean bill of lading.

Free Alongside (F.A.S.)		 (Or Free Alongside Steamer) The seller must deliver the goods to a pier and place them within reach of the ships loading equipment. The buyer arranges ship space and informs the seller when and where the goods are to be placed.
Free In (F.I.) A pricing term indicating that the charter of a vessel is responsible for the cost of loading and unloading goods from the vessel.
Free Of Capture And Seizure (F.C. & S.) An insurance clause providing that loss is not insured if due to capture, seizure, confiscation, and like actions whether legal or not, or from such acts as piracy, civil war, rebellion and civil strife.
Free Port An area such as a port city into which merchandise may legally be moved without payment of duties.
Free Trade A term based on a theory in economics, but in reality the practice is something quite different. The theory of free trade contends that everyone in the world will be better off if each nation eliminates tariffs and other barriers to the flow of products across borders. The practice of “free trade” departs from theory by including the export of money either for investment purposes or speculation. With firms able to move both money and products around the world, the benefits of lower prices and higher wages have not been enjoyed by most people. In addition, under recent “free trade” agreements, the concept of barriers to trade has been expanded to include domestic regulations, public health and human rights measures, and environmental protection laws which inhibit business activity.
Free-Trade Zone A port designated by the government of a country for duty-free entry of any nonprohibited goods. Merchandise may be stored, displayed, used for manufacturing, etc., within the zone and re-exported without duties being paid. Duties are imposed on the merchandise (or items manufactured from the merchandise) only when the goods pass from the zone into an area of the country subject to the customs authority.
Freight Forwarder An independent business that handles export shipments for compensation. (A freight forwarder is among the best sources of information and assistance on export regulations and documentation, shipping methods, and foreign import regulations.)
Freight To (Named Destination) The seller must pay to forward the goods to the agreed destination by road, rail or inland waterway and is responsible for all risks of the goods until they are delivered to the first carrier.
Fta A free trade area is a term used for a group of states that have reduced or eliminated trade barriers between themselves, but who maintain their own individual tariffs as to other states.
Ftaa The Free Trade Area of the Americas (FTAA) is an ambitious trade agreement would include all 34 countries in Central America, South America, and the Caribbean (except Cuba). The FTAA was proposed in 1994 right after the North American Free Trade Agreement (NAFTA) was enacted in attempt to expand that agreement and create the world’s largest free-trade bloc.