FAR 47.303-1—F.o.b. origin.
Plain-English Summary
FAR 47.303-1 explains the delivery term "f.o.b. origin" and the operational responsibilities that flow from using it in a federal contract. It defines exactly what delivery means at origin, including delivery to the carrier’s conveyance, wharf, freight station, U.S. Postal Service facility, or a Government-designated point within the same city or commercial zone when the solicitation says so. It also assigns the contractor’s duties for packing, marking, ordering carrier equipment, loading and securing shipments, bearing risk for loss or damage before carrier acceptance or caused by improper packing/loading, and preparing the bill of lading or transportation receipt. The section further requires specific information to be shown on the bill of lading, including freight classification, seal numbers, vehicle capacity, consignee information, routing, special annotations, and carrier receipt details. Finally, it tells the contracting officer to include the prescribed clause at FAR 52.247-29 when the contract uses f.o.b. origin. In practice, this section matters because it determines when delivery is complete, who bears transportation-related risk at the outset, and how shipping documents must be prepared to support proper movement and payment of freight charges.
Key Rules
Delivery occurs at origin
Under f.o.b. origin, the contractor delivers free of expense to the Government at the shipping point named in the contract. Delivery may be to the carrier’s conveyance, wharf, freight station, USPS facility, or a Government-designated point in the same city or commercial zone if the solicitation allows it.
Line-haul begins at origin
The origin point is the place from which line-haul transportation begins, not local switching, drayage, or terminal service. This distinction matters because it identifies the point at which the contractor’s delivery obligation is satisfied and transportation responsibility shifts.
Contractor must pack and mark properly
The contractor must pack and mark shipments to meet contract specifications, or if none exist, to meet carrier requirements in a way that protects the goods and secures the lowest applicable transportation charge. Improper packing or marking can make the contractor liable for resulting loss or damage.
Contractor must order suitable equipment
If the Government specifies carrier equipment, the contractor must order that equipment. If not specified, the contractor must order appropriate equipment with capacity sufficient for the shipment, but not more than needed.
Contractor must load and secure shipments
The contractor must deliver the shipment in good order and condition to the carrier and, when the contractor loads the shipment, must load, stow, trim, block, and brace it as required by carrier rules and regulations. Failure to do so can create contractor liability for damage.
Bill of lading must be complete
The contractor must complete the Government bill of lading if supplied, or prepare a commercial bill of lading or other transportation receipt if not. The document must include classification or tariff information, seal numbers, vehicle size/capacity, consignee and routing details, special instructions, and the carrier agent’s signature and date.
Required clause must be included
When the delivery term is f.o.b. origin, the contracting officer must insert the clause at FAR 52.247-29, F.o.b. Origin, in the solicitation and contract. This ensures the delivery term and related responsibilities are contractually enforceable.
Responsibilities
Contracting Officer
Use the f.o.b. origin term only when appropriate and insert FAR 52.247-29 in the solicitation and contract. Ensure the contract clearly identifies the origin point and any Government-designated delivery point if applicable.
Contractor
Deliver the shipment at the origin point, pack and mark it properly, order the correct carrier equipment, load and secure the shipment when responsible for loading, complete the required transportation document, and distribute copies as directed. The contractor also bears responsibility for loss or damage before carrier delivery and for damage caused by improper packing or loading.
Ordering Agency
Provide any Government bill of lading when used, specify carrier equipment if required, and direct how bill-of-lading copies or transportation receipts are to be distributed. The agency may also request special annotations for commercial bills of lading.
Carrier
Receive the shipment and acknowledge it by signature and date on the bill of lading or transportation receipt. Carrier rules and regulations govern equipment use and the proper loading, stowing, trimming, blocking, and bracing requirements that the contractor must follow.
Practical Implications
F.o.b. origin shifts the delivery point and much of the transportation risk to the Government once the contractor properly tenders the shipment to the carrier, so the exact moment of carrier acceptance matters.
Contractors should pay close attention to packing, marking, and loading because defects in those areas can leave them liable even after the shipment leaves their facility.
Shipping paperwork is not a formality: missing freight classification, routing, seal numbers, or consignee details can delay delivery, create billing problems, or cause disputes over freight charges.
If the solicitation does not specify carrier equipment, the contractor still must choose suitable equipment; ordering the wrong size or type can increase cost or cause noncompliance.
Contracting officers should not omit the required clause, because the clause ties the delivery term to the contract and helps avoid confusion over who is responsible for transportation-related obligations.
Official Regulatory Text
(a) Explanation of delivery term. "F.o.b. origin" means free of expense to the Government delivered- (1) On board the indicated type of conveyance of the carrier (or of the Government, if specified) at a designated point in the city, county, and State from which the shipment will be made and from which line-haul transportation service (as distinguished from switching, local drayage, or other terminal service) will begin; (2) To, and placed on, the carrier’s wharf (at shipside, within reach of the ship’s loading tackle, when the shipping point is within a port area having water transportation service) or the carrier’s freight station; (3) To a U.S. Postal Service facility; or (4) If stated in the solicitation, to any Government-designated point located within the same city or commercial zone as the f.o.b. origin point specified in the contract (the Federal Motor Carrier Safety Administration prescribes commercial zones at Subpart B of 49 CFR part 372 ). (b) Contractor responsibilities. The contractor shall- (1) (i) Pack and mark the shipment to comply with contract specifications; or (ii) In the absence of specifications, prepare the shipment in conformance with carrier requirements to protect the goods and to ensure assessment of the lowest applicable transportation charge; (2) (i) Order specified carrier equipment requested by the Government; or (ii) If not specified, order appropriate carrier equipment not in excess of capacity to accommodate shipment; (3) Deliver the shipment in good order and condition to the carrier, and load, stow, trim, block, and/or brace carload or truckload shipment (when loaded by the contractor) on or in the carrier’s conveyance as required by carrier rules and regulations; (4) Be responsible for any loss of and/or damage to the goods- (i) Occurring before delivery to the carrier; (ii) Resulting from improper packing and marking; or (iii) Resulting from improper loading, stowing, trimming, blocking, and/or bracing of the shipment, if loaded by the contractor on or in the carrier’s conveyance; (5) Complete the Government bill of lading supplied by the ordering agency or, when a Government bill of lading is not supplied, prepare a commercial bill of lading or other transportation receipt. The bill of lading shall show- (i) A description of the shipment in terms of the governing freight classification or tariff (or Government rate tender) under which lowest freight rates are applicable; (ii) The seals affixed to the conveyance with their serial numbers or other identification; (iii) Lengths and capacities of cars or trucks ordered and furnished; (iv) Other pertinent information required to effect prompt delivery to the consignee, including name, delivery address, postal address and ZIP code of consignee, routing, etc.; (v) Special instructions or annotations requested by the ordering agency for commercial bills of lading; e.g., "This shipment is the property of, and the freight charges paid to the carrier(s) will be reimbursed by, the Government" ; and (vi) The signature of the carrier’s agent and the date the shipment is received by the carrier; and (6) Distribute the copies of the bill of lading, or other transportation receipts, as directed by the ordering agency. (c) Contract clause. The contracting officer shall insert in solicitations and contracts the clause at 52.247-29 , F.o.b. Origin, when the delivery term is f.o.b. origin.