47.303-6 F.o.b. destination
Source: FAR 47.303-6 on acquisition.gov
F.o.b. destination requires contractors to deliver goods at their own expense and risk to a specified government location, with the government assuming responsibility only after actual delivery.
Overview
FAR 47.303-6 defines the requirements and responsibilities associated with the delivery term "F.o.b. destination" in government contracts. This term means that the contractor is responsible for delivering goods, at their own expense, to a specified government location, ensuring the shipment arrives in good order and condition. The government is not liable for any delivery-related charges before actual delivery, unless caused by its own actions. The section also outlines specific contractor duties, including packaging, marking, preparing bills of lading, and bearing all delivery costs. Contracting officers are required to include the clause at 52.247-34 in solicitations and contracts using this delivery term.
Key Rules
- Definition of F.o.b. Destination
- Contractor delivers goods free of expense to the government at a specified location, and is responsible for all costs and risks until delivery is complete.
- Delivery Procedures
- Specifies how and where goods must be delivered, including special provisions for rail, motor carrier, and heavy/bulky freight.
- Contractor Responsibilities
- Contractor must pack, mark, prepare bills of lading, deliver in good condition, provide delivery schedules, and pay all delivery charges.
- Contract Clause Requirement
- Contracting officers must include FAR 52.247-34 in contracts specifying F.o.b. destination.
Responsibilities
- Contracting Officers: Must include the correct clause and ensure delivery terms are clear.
- Contractors: Must comply with all delivery, packaging, and documentation requirements, and bear all costs and risks until delivery.
- Agencies: Oversee compliance and resolve any government-caused delivery issues.
Practical Implications
- Ensures the government receives goods at no additional delivery cost or risk.
- Contractors must plan logistics carefully to avoid unexpected expenses or liability.
- Common issues include misunderstanding delivery points, failing to provide proper documentation, or not accounting for special freight requirements.
(a) Explanation of delivery term."F.o.b. destination"- means-
(1) Free of expense to the Government delivered, on board the carrier’s conveyance, at a specified delivery point where the consignee’s facility (plant, warehouse, store, lot, or other location to which shipment can be made) is located; and
(2) Supplies shall be delivered to the destination consignee’s wharf (if destination is a port city and supplies are for export), warehouse unloading platform, or receiving dock, at the expense of the contractor. The Government shall not be liable for any delivery, storage, demurrage, accessorial, or other charges involved before the actual delivery (or "constructive placement" as defined in carrier tariffs) of the supplies to the destination, unless such charges are caused by an act or order of the Government acting in its contractual capacity. If rail carrier is used, supplies shall be delivered to the specified unloading platform of the consignee. If motor carrier (including "piggyback") is used, supplies shall be delivered to truck tailgate at the unloading platform of the consignee, except when the supplies delivered meet the requirements of Item568 of the National Motor Freight Classification for "heavy or bulky freight." When supplies meeting the requirements of the referenced Item568 are delivered, unloading (including movement to the tailgate) shall be performed by the consignee, with assistance from the truck driver, if requested. If the contractor uses rail carrier or freight forwarder for less than carload shipments, the contractor shall ensure that the carrier will furnish tailgate delivery when required, if transfer to truck is required to complete delivery to consignee.
(b) Contractor responsibilities. The contractor shall-
(1)
(i) Pack and mark the shipment to comply with contract specifications; or
(ii) In the absence of specifications, prepare the shipment in conformance with carrier requirements;
(2) Prepare and distribute commercial bills of lading;
(3) Deliver the shipment in good order and condition to the point of delivery specified in the contract;
(4) Be responsible for any loss of and/or damage to the goods occurring before receipt of the shipment by the consignee at the delivery point specified in the contract;
(5) Furnish a delivery schedule and designate the mode of delivering carrier; and
(6) Pay and bear all charges to the specified point of delivery.
(c) Contract clause. The contracting officer shall insert in solicitations and contracts the clause at 52.247-34, F.o.b. Destination, when the delivery term is f.o.b. destination.