FOB Full Form is Free On Board. This is an American term, which is also used in International Commercial Law. It indicates the period when the seller gives away the ownership of goods to buyer. According to the International Chamber of Commerce’s (Icc) Incoterms 2010, FOB term is used only in sea freight that have no containers.
It also defines the transfer of ownership. This means, the owners of goods are responsible for loss or damage during the transport. Contracts that involve International shipping have several trade terms. One among them is Incoterms. Most manufacturers have FOB policy to understand when the customer receives the goods it will be in perfect condition.