Procurement Glossary
Incoterms FCA: Definition, application and meaning in Procurement
November 19, 2025
Incoterms FCA (Free Carrier) is one of the most important delivery clauses in international trade and precisely defines the responsibilities between buyer and seller. This regulation determines the transfer of costs and risks when transporting goods and is particularly relevant for multimodal transportation. Incoterms FCA offers companies flexibility in logistics organization and cost control. Find out below what FCA means exactly, how it is applied and what strategic advantages it offers in Procurement .
Key Facts
- FCA stands for "Free Carrier" and is part of the multimodal Incoterms 2020
- Seller delivers goods to a named place and hands them over to the buyer's carrier
- Risk and costs are transferred upon handover to the carrier
- Buyer bears the main transport costs and organizes the transport from the place of delivery
- Particularly suitable for container and multimodal transportation
Contents
What is Incoterms FCA? Definition, obligations and benefits
FCA defines a delivery clause in which the seller hands over the goods to the buyer's carrier at an agreed place.
Basic features of FCA
In the case of FCA deliveries, the seller assumes responsibility until the goods are handed over to the carrier. The place of delivery may be the seller's premises or another designated place.
- Seller provides goods and hands them over properly
- Export formalities are handled by the seller
- Buyer organizes and pays for the main transport
- Insurance is optional and is the responsibility of the buyer
FCA vs. other Incoterms
Compared to EXW, the seller assumes more responsibility with FCA, while with CPT the seller organizes the main transport. FCA offers a balanced distribution of risk between the parties.
Importance of FCA in Procurement
FCA gives buyers better control over transportation costs and logistics service providers. This flexibility is particularly valuable when optimizing supply chains and using preferred carriers.
Requirements and implementation of Incoterms FCA
The successful application of FCA requires clear agreements and structured processes between all parties involved.
Contract design and agreements
In the case of FCA contracts, the exact handover location and modalities must be precisely defined. The seller is responsible for export processing, while the buyer is responsible for import formalities.
- Unique place name with address
- Set time window for handover
- Specify documentation requirements
Logistical coordination
Coordination between seller and buyer is crucial for smooth processes. The buyer must name a carrier in good time and organize transport insurance.
Documentation and compliance
Both parties must fulfill their respective documentation obligations. This includes delivery bills, export documents and proper customs clearance in the country of export.
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Compliance key figures and quotas
FCA performance is measured using specific key figures that evaluate efficiency and compliance.
Delivery performance key figures
Punctuality of handover and completeness of documentation are key metrics. Delivery performance is typically measured as a percentage of on-time handovers.
- On-time delivery rate (OTDR): > 95%
- Document completeness: > 98%
- Fehlerquote bei Exportdokumenten: < 2%
Cost efficiency metrics
Transport cost analyses and comparisons with alternative Incoterms show the economic benefits of FCA agreements. Regular freight audits ensure cost transparency.
Compliance indicators
Monitoring of customs clearance times and complaint rates by authorities. These key figures help to continuously improve FCA processes and minimize compliance risks.
Compliance risks and controls for Incoterms FCA
FCA transactions give rise to specific risks that can be minimized by means of suitable control mechanisms.
Transport risks and insurance cover
As the buyer is responsible for the main transportation, he also bears the corresponding risks. Appropriate transport insurance is therefore essential to protect against damage or loss.
- Insufficient insurance cover
- Damage during transportation
- Delays due to transportation problems
Documentation and compliance risks
Incorrect or incomplete documentation can lead to delays in customs clearance. Inconsistencies in export documents and freight documents are particularly critical.
Coordination risks
A lack of coordination between the seller and buyer can lead to problems during the handover. Clear communication channels and defined responsibilities are therefore essential for successful FCA transactions.
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Practical example
A German mechanical engineering company purchases components from China under FCA conditions. The Chinese supplier delivers the goods to the FCA Shanghai Terminal and hands them over to the forwarder commissioned by the German buyer. The buyer organizes the sea transport to Hamburg and bears all costs from handover. By controlling the transport, the company can use preferred shipping companies and optimize costs.
- Seller: Provision and export clearance in Shanghai
- Buyer: Sea transportation, import clearance and onward transportation to Germany
- Cost savings: 15% through optimized transport selection
Current developments and interpretation of Incoterms FCA
The use of FCA is constantly evolving, influenced by technological innovations and changing retail structures.
Digitization of documentation
Electronic waybills and digital commercial invoices simplify the processing of FCA transactions. AI-based systems support the automatic creation and verification of transport documents.
Sustainability and green logistics
Companies are increasingly using FCA for sustainable transportation solutions. Control over the choice of transportation enables preference to be given to environmentally friendly carriers and multimodal concepts.
- Integration of CO2 tracking in transportation decisions
- Preference for rail and inland waterway transportation
- Optimization of transport routes through AI algorithms
Flexibilization through e-commerce
Growing e-commerce trade is leading to more flexible FCA applications with shorter delivery times and adapted delivery schedules.
Conclusion
Incoterms FCA offers a balanced distribution of risk and gives buyers strategic control over their transportation logistics. The flexibility in the choice of carriers and transport routes makes FCA particularly valuable for cost-optimized procurement strategies. However, successful FCA application requires precise contract design and effective coordination between all parties involved. Companies that use FCA strategically can significantly reduce their logistics costs and increase supply chain flexibility at the same time.
FAQ
What does FCA mean for Incoterms?
FCA stands for "Free Carrier" and means that the seller hands over the goods to the buyer's carrier at an agreed location. From this moment on, the costs and risks are transferred to the buyer, who organizes and pays for the further transport.
Who bears the transportation costs at FCA?
In the case of FCA, the buyer bears the main transportation costs from the place of delivery. The seller is only responsible for the costs up to handover to the carrier, including export clearance in the country of dispatch.
What insurance is required for FCA?
At FCA, neither party is obliged to take out transport insurance. However, as the buyer bears the transport risk, it is strongly recommended to organize appropriate insurance for the entire transport.
How does FCA differ from FOB?
FCA is suitable for all types of transportation, while FOB is only used for sea transport. With FCA, the goods are handed over to the carrier, with FOB only when they are loaded onto the ship. FCA offers more flexibility for multimodal transportation.
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