FAR 47.303-9—F.o.b. vessel, port of shipment.
Plain-English Summary
FAR 47.303-9 explains the delivery term "f.o.b. vessel, port of shipment" and sets out what that term means for risk, packing, loading, documentation, and contract administration when goods move by ocean vessel. It tells contractors that delivery is complete only when the shipment is loaded, stowed, and trimmed on board the named ocean vessel at the specified port, free of expense to the Government. The section also assigns responsibility for packing and marking, preparing the shipment for ocean transport when no specifications exist, paying the costs of getting the goods actually on board, and providing a clean ship’s receipt or on-board ocean bill of lading. It further makes the contractor responsible for loss or damage before on-board delivery and requires the contractor to assist, at the Government’s request and expense, with export or import documents. Finally, it directs contracting officers to include the prescribed clause at 52.247-37 whenever this delivery term is used, ensuring the contract language matches the shipping obligation and risk allocation.
Key Rules
Delivery is on board vessel
Under this term, the contractor’s delivery obligation is satisfied only when the goods are loaded, stowed, and trimmed on the ocean vessel at the specified port of shipment. The Government pays no expense for that delivery point, so the contractor must get the shipment physically on board in the required condition.
Proper packing and marking
The contractor must pack and mark the shipment to meet contract specifications. If the contract does not specify packing requirements, the contractor must prepare the shipment in line with carrier requirements so the goods are protected and the lowest applicable transportation charge is obtained.
Timely on-board delivery and costs
The contractor must deliver the shipment on board the vessel in good order and condition on the date or within the period required by the contract. The contractor also bears all charges incurred in placing the shipment actually on board, including the costs associated with loading and related handling.
Required shipping evidence
The contractor must provide a clean ship’s receipt or an on-board ocean bill of lading. This documentation is important because it proves the goods were accepted on board the vessel and supports contract administration, payment, and shipment tracking.
Risk remains with contractor until loading
The contractor is responsible for any loss of or damage to the goods occurring before the shipment is delivered on board the ocean vessel. In practical terms, the risk of pre-loading damage or loss stays with the contractor until the delivery point is reached.
Document assistance on request
At the Government’s request and expense, the contractor must assist in obtaining documents needed for exportation or importation at destination. This duty is limited to assistance and does not shift the cost of those documents to the contractor when the Government requests the help.
Mandatory clause insertion
The contracting officer must insert FAR 52.247-37, F.o.b. Vessel, Port of Shipment, in solicitations and contracts when this delivery term is used. This ensures the contract contains the proper clause implementing the delivery term and related obligations.
Responsibilities
Contracting Officer
Use the f.o.b. vessel, port of shipment term only with the corresponding clause and insert FAR 52.247-37 in the solicitation and contract. The contracting officer should ensure the contract clearly identifies the port of shipment and aligns the delivery term with the intended allocation of shipping responsibility and risk.
Contractor
Pack and mark the shipment properly, prepare it for ocean transport if no packing specifications exist, deliver the goods on board the named vessel on time and in good order, pay all charges needed to place the shipment actually on board, provide a clean ship’s receipt or on-board ocean bill of lading, bear loss or damage before on-board delivery, and assist with export or import documents when requested by the Government at Government expense.
Government
Accept the delivery term’s allocation of responsibility once the shipment is on board the vessel and, if it requests the contractor’s help obtaining export or import documents, pay the expense of that assistance. The Government also relies on the required shipping documents to verify proper delivery and contract performance.
Practical Implications
This term shifts the critical delivery point to the vessel at the port of shipment, so contractors must control packing, port handling, and loading closely to avoid late delivery or damage claims.
A common pitfall is assuming delivery occurs when the goods reach the port; under this term, the contractor remains responsible until the shipment is actually on board the vessel.
Contractors should make sure the shipping documents are clean and specifically show on-board loading, because incomplete or nonconforming documents can delay acceptance, payment, or proof of delivery.
If the contract lacks packing specifications, the contractor still must choose packaging that protects the goods and supports the lowest applicable transportation charge, so poor packaging can create both performance and cost problems.
Contracting officers should not use this delivery term without the required clause, because the clause is what operationalizes the parties’ obligations and helps avoid disputes over loading, risk, and documentation.
Official Regulatory Text
(a) Explanation of delivery term. "F.o.b. vessel, port shipment" means free of expense to the Government loaded, stowed, and trimmed on board the ocean vessel at the specified port of shipment. (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 ocean transportation in conformance with carrier requirements to protect the goods and to ensure assessment of the lowest applicable transportation charge; (2) (i) Deliver the shipment on board the ocean vessel in good order and condition on the date or within the period fixed; and (ii) Pay and bear all charges incurred in placing the shipment actually on board; (3) Provide a clean ship’s receipt or on-board ocean bill of lading; (4) Be responsible for any loss of and/or damage to the goods occurring before delivery of the shipment on board the ocean vessel; and (5) At the Government’s request and expense, assist in obtaining the documents required for- (i) Exportation; or (ii) Importation at destination. (c) Contract clause . The contracting officer shall insert in solicitations and contracts the clause at 52.247-37 , F.o.b. Vessel, Port of Shipment, when the delivery term is f.o.b. vessel, port of shipment.