So, Who’s a Freight Forwarder?
A Freight forwarder is a company who takes care of getting your goods from here to there. They handle the ins and outs of shipping and all the details that come with it, like loading and packing.
You can refer to this guide on how to choose freight forwarder in China
When Do You Need an FCR?
An FCR comes into play primarily in international deals, especially when everyone agrees to use the Ex Works (EXW) arrangement. Ex Works means the seller gets your shipment to you at a certain place and time, taking on all the risks and costs until you get it. It’s also a document banks often want to see when you’re paying with a letter of credit.
What Makes an FCR Special?
| eature | Explanation |
|---|---|
| Not a Shipping Contract | An FCR is not recognized by banks as a transport document within letters of credit. |
| Proof of Receipt | The FCR acts as the forwarder’s assurance to the seller that the cargo is in their possession and will be delivered to the buyer. |
| Non-Transferable | The FCR is exclusive to the seller—it can’t be passed around. Only the seller can use it to confirm goods have been handed over and to facilitate payment. |
| Original Document Requirement for Cancellation | An FCR can only be annulled if the original document is returned to the forwarder. |
Here’s the lowdown:
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- The FCR isn’t a shipping contract, so banks don’t see it as a transport document for letters of credit.
- When a forwarder hands over an FCR, they’re telling the seller, “I’ve got your shipment, and I’ll make sure it gets to the buyer safe and sound.”
- The FCR isn’t something you can pass around. It’s a one-holder ticket, which means only the seller who gets it can use it to show they handed over their goods and get paid.
- Canceling an FCR? That can only happen if the forwarder gets the original document back.
FCR vs. Sea Waybill: What’s the Difference?
- Unlike an FCR, a sea waybill outlines the shipping contract from point A to point B.
- To deliver goods with a sea waybill, you need at least one original copy. With an FCR, that’s not necessary.
- Banks will take a sea waybill for letters of credit, but not an FCR.
- A sea waybill can change hands through transfer; an FCR is more of a ‘no take-backs’ kind of deal.
Wrap-Up on Forwarder’s Cargo Receipt (FCR)
In a nutshell, an FCR is a document a freight forwarder gives you to confirm they’ve received your goods. It means the forwarder is now on the hook to get your items where they need to go. It’s all about trust and making sure everyone does what they promised in the shipping game.