FCA Incoterm: Free Carrier Delivery Terms

What FCA Means

FCA (Free Carrier) is an Incoterm under Incoterms 2020 (ICC) in which the seller delivers the goods to a named carrier or another nominated party at a specified location, and export clearance is the seller’s responsibility. Once the goods are handed to the carrier at the agreed point, risk transfers to the buyer.

FCA is one of the most flexible Incoterms because it works for any transport mode — air freight, sea freight, road, or multimodal — and it splits responsibilities at a point the two parties negotiate directly.

The Two FCA Variants

The named delivery point determines which variant applies. The 2020 revision of Incoterms clarified this distinction.

Variant 1: FCA Seller’s Premises

The seller loads the goods onto the buyer’s collecting vehicle at the seller’s own warehouse, factory, or office. Risk transfers once the goods are loaded on that vehicle. The seller is responsible for loading costs and export clearance. This variant is common when buyers use their own freight forwarder and the forwarder sends a truck to collect from the supplier.

Variant 2: FCA Named External Location

The seller delivers the goods to a nominated point outside their premises — typically a freight terminal, airport cargo facility, or forwarder’s warehouse. The seller is responsible for transporting the goods to that point and completing export formalities. Risk transfers when the goods are delivered to the carrier at that external location. The seller is not responsible for loading if the location is not their own premises.

When Risk Transfers Under FCA

Risk passes from seller to buyer at the moment of delivery to the carrier at the named point. If goods are damaged or lost after that handover, the buyer bears the loss.

This is a critical distinction from CIF or CPT terms, where the seller arranges the main carriage. Under FCA, the buyer typically contracts the main freight leg directly with their forwarder or carrier.

Export Clearance: Seller’s Obligation

Under FCA, the seller must obtain and pay for the export licence, customs clearance, and any export duties in the country of origin. This is what distinguishes FCA from EXW (Ex Works), where the buyer bears all export obligations. For importers sourcing from Hong Kong or UAE, this matters: in both jurisdictions the seller handles the export declaration, which reduces customs risk and administrative burden for the buyer.

FCA in Air Freight from Hong Kong and Dubai

Air freight is the dominant mode for high-value phone shipments. Both Hong Kong International Airport (HKIA) and Dubai International Airport are major consolidation hubs.

Under FCA Hong Kong Airport, the seller delivers goods to the cargo terminal at HKIA, completes export clearance, and hands over to the buyer’s nominated air carrier. The buyer contracts their freight forwarder for the main airfreight leg from HK to destination. This is the typical structure for buyers sourcing unlocked Android and Apple handsets from HK traders.

Under FCA Dubai Airport (or FCA Jebel Ali Free Zone for sea freight), the same logic applies. UAE-based traders working under FCA terms handle UAE export documentation; the buyer’s forwarder manages the outbound flight booking.

FCA vs EXW vs CPT

Term	Export clearance	Main carriage	Loading at origin	Risk transfer point
EXW	Buyer	Buyer	Buyer	Seller’s premises (pre-load)
FCA	Seller	Buyer	Seller (if seller’s premises)	Named delivery point
CPT	Seller	Seller	Seller	First carrier in origin country

EXW vs FCA: EXW places every logistics step on the buyer, including export customs in a foreign country. For most importers, this is impractical and creates compliance risk. FCA at minimum shifts export clearance to the seller, who operates in their own jurisdiction.

FCA vs CPT: Under CPT (Carriage Paid To), the seller contracts and pays for the main carriage to the named destination. FCA stops at origin; the buyer takes responsibility for the main freight leg. FCA typically gives the buyer more control over carrier choice and freight costs.

Practical Negotiation Tips

Name the FCA point precisely. Vague terms like “FCA Hong Kong” create disputes. Specify the exact facility: “FCA HKIA Cargo Terminal 1, Zone 3” or “FCA Seller’s Warehouse, Unit 7, Kwun Tong Industrial Centre, Hong Kong.” The more specific the address, the clearer the handover point and the less room for dispute.

Confirm who books the carrier. Under FCA the buyer usually books the main carrier (forwarder or airline cargo agent). Confirm this in writing before the transaction closes so there is no gap between the seller completing export and a carrier arriving to collect.

Check the 2020 bill of lading clause. Incoterms 2020 added a specific provision allowing FCA buyers to instruct their bank to issue an on-board bill of lading to the seller, which the seller can then present under a documentary credit (LC). If your transaction involves an LC, confirm this mechanism with your forwarder and issuing bank before shipping.

Scenario: HK-to-UK Air Freight

A UK importer contracts 500 refurbished iPhones from a Hong Kong trader. They agree FCA HKIA Cargo Terminal. The HK trader packs the goods, completes Hong Kong export declaration, transports the consignment to HKIA cargo, and delivers to the UK buyer’s nominated freight forwarder. Risk transfers at HKIA. The UK forwarder books the flight to Heathrow and handles UK import customs.

Scenario: UAE-to-US Air Freight

A US reseller sources 200 Samsung handsets from a Dubai free-zone trader. They agree FCA Jebel Ali Free Zone, Seller’s Warehouse. The Dubai trader loads the goods onto the US buyer’s collecting freight vehicle and completes UAE export formalities. Risk transfers on loading. The buyer’s US-based forwarder manages the Dubai-to-Chicago air leg and US customs entry.