IGNOU : M.COM : IBO 4 : UNIT 2 : Q - 1. Discuss the duties of an exporter under FOB and CIF contract.

 Ans.  The duties of exporter under FOB contract:

i) Supply the contracted goods in conformity with the contract of sale and deliver the goods on board the vessel named by the buyer at the named port of shipment.

ii) Bear all costs and risks of the goods until such time as they shall have effectively passed the ship's rail.

iii) Provide at his own expense the customary clean documents in proof of the delivery of the goods.

The duties of the exporter under CIF contract:

i) Supply the goods in conformity with the contract of sale, arrange at his own expense for the shipping space by the usual route and pay freight charges for the carriage of goods.

ii) Obtain at his own risk and expense all documentation regarding governmental - authorization necessary for the export of goods.

iii) Load the goods at his own expense on board the vessel at the port of shipment. He should procure at his own cost in a transferable form a policy of marine insurance for a value equivalent of CIF plus 10 per cent.

iv) Bear all risks until the goods have effectively crossed the ship's rail and furnish to the buyer a clean negotiable bill of lading.