FOB (Free On Board)
What is fob (free on board)? FOB defines the point in shipment where title and freight charges transfer from shipper to buyer — FOB Origin transfers at the shipping dock, FOB Destination at delivery.
Full definition
FOB Origin (more common) means the buyer takes title at the shipper's dock and pays the freight bill. The buyer is also responsible for damage in transit. FOB Destination means the seller retains title until delivery and pays the freight bill.
Most carriers don't see FOB language in their day-to-day, but it matters when shipments are claimed for damage. Whoever holds title at the time of damage is the entity that files (or absorbs) the claim.
Brokers structure FOB into their rate confirmations to set the chain of responsibility. Carriers should read FOB terms before signing rate confirmations on high-value freight.