FAR 47.303-16—F.o.b. designated air carrier’s terminal, point of importation.
Plain-English Summary
FAR 47.303-16 defines the delivery term "f.o.b. designated air carrier’s terminal, point of importation" and explains how it allocates delivery, packing, documentation, cost, and risk responsibilities when goods are shipped by air into the United States or another import point named in the contract. It tells contractors exactly what it means to deliver "free of expense to the Government" at the air carrier’s terminal at the specified point of importation, and it clarifies that the contractor—not the Government—must handle packaging, marking, shipping documents, transportation and related charges, and protection of the goods until delivery is completed. The section also addresses who bears export/import fees, landing costs, customs duties, and document costs such as certificates of origin and consular invoices. In practice, this clause is important because it determines when title-risk-like responsibility shifts for loss or damage, who pays the logistics bill, and what paperwork must accompany the shipment. It also requires the contracting officer to include the corresponding FAR clause at 52.247-44 in solicitations and contracts whenever this delivery term is used.
Key Rules
Delivery at named terminal
The term means the contractor must deliver the shipment, free of expense to the Government, to the air carrier’s terminal at the point of importation identified in the contract. The contract must specify the delivery point, and performance is measured against that location.
Packing and marking required
The contractor must pack and mark the shipment to meet contract specifications. If the contract does not provide packing specifications, the contractor must prepare the shipment for air transport in accordance with carrier requirements so the goods are protected during transit.
Shipping documents prepared
The contractor must prepare and distribute the bills of lading or air waybills needed for the shipment. This places responsibility for transportation documentation on the contractor, not the Government.
All charges borne by contractor
The contractor must pay all charges incurred up to the specified delivery point, including transportation costs, export or import fees or taxes, landing costs, customs duties, and costs of required certificates of origin, consular invoices, or similar documents.
Risk remains with contractor
The contractor is responsible for any loss of or damage to the goods until delivery is made to the Government at the designated air carrier’s terminal. The risk does not shift merely because the shipment is in transit or has reached the import point unless delivery has been completed as required.
Mandatory clause insertion
When this delivery term is used, the contracting officer must insert FAR clause 52.247-44, F.o.b. Designated Air Carrier’s Terminal, Point of Importation, in the solicitation and contract.
Responsibilities
Contracting Officer
Use this delivery term only when appropriate for the acquisition and insert the required clause at FAR 52.247-44 in both the solicitation and the contract. The contracting officer should ensure the contract clearly identifies the point of importation and any applicable packing or documentation requirements.
Contractor
Pack and mark the shipment properly, prepare and distribute the required bills of lading or air waybills, deliver the goods in good order and condition to the specified air carrier’s terminal, pay all charges up to that point, and bear the risk of loss or damage until delivery is completed.
Government
Accept delivery at the designated air carrier’s terminal once the contractor has met the contract’s delivery requirements. The Government does not bear the listed transportation, customs, or document costs under this delivery term.
Practical Implications
This term shifts a substantial logistics burden to the contractor, so pricing must account for freight, customs-related charges, and document costs as well as packaging and handling.
A common pitfall is assuming risk transfers earlier than it actually does; under this term, the contractor remains responsible until delivery to the Government at the designated terminal is complete.
If the contract is silent on packing standards, the contractor must still use carrier-appropriate packaging for air shipment, so lack of specifications does not eliminate the duty to protect the goods.
The contracting officer must remember to include the prescribed clause; omitting FAR 52.247-44 can create ambiguity about responsibilities and risk allocation.
Because the point of importation is contract-specific, unclear destination language can lead to disputes over where delivery occurred and which party bears charges or damage at each stage.
Official Regulatory Text
(a) Explanation of delivery term. "F.o.b. designated air carrier’s terminal, point of importation" means free of expense to the Government delivered to the air carrier’s terminal at the point of importation specified in the contract. (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 for air transportation in conformance with carrier requirements to protect the goods; (2) Prepare and distribute bills of lading or air waybills; (3) (i) Deliver the shipment in good order and condition to the point of delivery specified in the contract; and (ii) Pay and bear all charges incurred up to the point of delivery specified in the contract, including transportation costs; export, import, or other fees or taxes; cost of landing, if any; customs duties; and costs of certificates of origin, consular invoices, or other documents that may be required for exportation or importation; and (4) Be responsible for any loss of and/or damage to the goods until delivery of the goods to the Government at the designated air carrier’s terminal. (c) Contract clause. The contracting officer shall insert in solicitations and contracts the clause at 52.247-44 , F.o.b. Designated Air Carrier’s Terminal, Point of Importation, when the delivery term is f.o.b. designated air carrier’s terminal, point of importation.