In trade terms, what does "FOB" stand for?

The term "FOB" stands for "Free On Board." This terminology is used in international trade to signify the point at which the responsibility for goods transfers from the seller to the buyer. Under FOB terms, the seller is responsible for all costs and risks associated with transporting goods to a specified shipping point, usually the port of departure. Once the goods are loaded onto the transport vessel, the responsibility shifts to the buyer, who then bears the costs and risks associated with transporting the goods to their final destination.

Choosing "Free On Board" accurately reflects this definition and aligns with standard global shipping practices and terminologies. Understanding FOB is essential for businesses involved in international trade as it defines liabilities, costs, and responsibilities that come with the transaction. In contrast, the other definitions provided do not accurately represent the meaning of FOB within the context of shipping and trade.