What is FCA Delivery Term, and How is it Implemented?

What is FCA Delivery Term, and How is it Implemented?

In international trade, delivery terms are crucial for ensuring that commercial transactions are conducted securely and smoothly. FCA (Free Carrier) delivery term, defined under Incoterms (International Commercial Terms) 2020 rules, is a widely used delivery method. This article will explain what the FCA delivery term is, how it is applied, and the important aspects to consider under Turkish customs regulations.

What is the FCA Delivery Term?

FCA is a delivery term where the seller delivers the goods to a carrier specified by the buyer. In this delivery term, the seller’s responsibility ends when the goods are handed over to the carrier. From this point on, the transportation costs and risks transfer to the buyer. FCA is particularly ideal for situations where different modes of transport are used, and the seller wants to have more control over the initial phase of transportation.

Elements of the FCA Delivery Term

1. Delivery Location: In the FCA delivery term, the delivery location can be a point agreed upon by the seller and the buyer. This point is usually the seller’s factory, warehouse, or another specified location.
2. Carrier Selection: The buyer selects the carrier and arranges the transportation. The seller delivers the goods to the carrier specified by the buyer.
3. Customs Procedures: The seller completes the export customs procedures. The buyer is responsible for the import customs procedures.
4. Transfer of Risks and Costs: The risks and costs transfer to the buyer when the goods are handed over to the carrier.

How is the FCA Delivery Term Implemented?

The successful implementation of the FCA delivery term involves the following steps:

1. Contract Preparation: A sales contract specifying the FCA delivery term is prepared between the seller and the buyer. The delivery location and conditions should be clearly stated.
2. Carrier Arrangements: The buyer selects a carrier for transporting the goods and arranges the transportation. The date and time for delivery to the carrier are determined.
3. Export Customs Procedures: The seller completes the export customs procedures in accordance with Turkish customs regulations. The customs declaration and necessary documents are prepared.
4. Preparation and Delivery of Goods: The seller delivers the goods to the carrier at the specified date and location. During delivery, the necessary documents (invoice, packing list, certificate of origin, etc.) are provided to the carrier.
5. Transportation and Insurance: The buyer may take out insurance against any damage or loss that may occur during transportation. Obtaining insurance is the buyer’s responsibility.
6. Import Customs Procedures: The buyer completes the import customs procedures in the destination country and takes delivery of the goods.

Important Points to Consider According to Turkish Customs Regulations

According to Turkish customs regulations, exporters should pay attention to several important points in the FCA delivery term:

1. Customs Declaration: The exporter must prepare the customs declaration accurately and completely for the export of goods. The declaration should be submitted with GTIP (Customs Tariff Statistical Position) codes and other relevant information.
2. Taxes and Duties: Taxes and duties that must be paid during export are the responsibility of the exporter. Export operations in Turkey are generally exempt from VAT, but other taxes and duties may apply.
3. Preparation of Documents: The exporter must prepare the necessary documents (invoice, packing list, certificate of origin, etc.) and provide them to the carrier. These documents are essential for the smooth completion of customs procedures.
4. Inspections and Controls: The exporter must cooperate and provide the necessary information during inspections and controls conducted by customs officers.

The FCA delivery term is a commonly preferred method in international trade, where the responsibilities and risks between the seller and the buyer are clearly defined. It is crucial for exporters to carefully and accurately complete export customs procedures in accordance with Turkish customs regulations. In this process, cooperation between the seller and the buyer ensures a smooth delivery. When properly implemented, the FCA delivery term offers a secure and advantageous trading environment for both parties.