What is Freight Prepaid in Shipping?

Freight prepaid is a general shipping term used when the seller or the shipper of goods pays the freight charges to the shipping line for transporting the goods to the buyer’s specified location.

This term is very closely connected to ‘Free on Board (FOB) Destination, Freight Prepaid’ which means that the shipper pays all freight charges on the cargo until it is delivered to the customer’s premises.

In this case, the ownership and responsibility of the goods remain with the seller until it is delivered to the customer.

Another term ‘FOB Origin, Freight Prepaid’ is used when the ownership of the goods passes on to the customer at the point of origin, when it is given to the carrier for transport and freight charges have been paid.

The term ‘FOB’ is thus used to specify the point at which the ownership passes from the seller to the customer.

The term ‘Cost, Insurance, Freight’ (CIF) is also a freight prepaid arrangement where the seller bears the cost, insurance, and freight of the goods.

Source: Marine Insight


Related News

Understanding Shipping Container Numbers
Understanding Shipping Container Numbers

Currently, the container capacity of 5 of the world’s major players in container transport is estimated at 16.4 million TEUs (Twenty Equivalent Units). More than 90% of global cargo is transported by multimodal containers.

What is Sustainable Logistics?
What is Sustainable Logistics?

Pollution is the biggest scourge on earth. In man’s race for power, the unchecked and reckless use of natural resources has left our planet tottering on the brink of an ecological disaster.

U.S. - VIETNAM PHONE CALL ON RECIPROCAL TAX FRAMEWORK: A POSITIVE SIGNAL FOR BILATERAL TRADE
U.S. - VIETNAM PHONE CALL ON RECIPROCAL TAX FRAMEWORK: A POSITIVE SIGNAL FOR BILATERAL TRADE

On the evening of July 2, 2025, General Secretary Tô Lâm and U.S. President Donald Trump held an important phone conversation, marking a new step forward in economic and trade relations between the two countries. Among the most closely watched topics by the public and business community was the agreement on reciprocal taxation — a "hot" issue amid the U.S.'s aggressive imposition of trade tariffs on goods from several Asian countries, including Vietnam.


main.add_cart_success