52.247-34 F.o.b. Destination
Source: FAR 52.247-34 on acquisition.gov
FAR 52.247-34 requires contractors to deliver goods to the Government's specified location at their own expense and risk, ensuring the Government incurs no delivery-related costs or liabilities before receipt.
Overview
FAR 52.247-34, F.o.b. Destination, defines the requirements for delivery of supplies to the Government at a specified destination, with all costs and risks borne by the contractor until delivery is complete. This clause ensures that the Government receives goods free of expense at the designated location, and the contractor is responsible for all transportation, handling, and associated charges up to that point. The clause also outlines specific responsibilities for packing, marking, documentation, and liability for loss or damage prior to delivery.
Key Rules
- Definition of F.o.b. Destination
- The contractor must deliver supplies free of expense to the Government at the specified delivery point, which could be a plant, warehouse, dock, or other location.
- Delivery Requirements
- The contractor is responsible for all delivery, storage, demurrage, and accessorial charges before actual delivery, unless caused by Government action.
- Specific delivery procedures are outlined for rail and motor carriers, including special provisions for heavy or bulky freight.
- Contractor Responsibilities
- The contractor must pack and mark shipments per contract or carrier requirements, prepare bills of lading, deliver goods in good condition, provide delivery schedules, and pay all delivery charges.
- The contractor is liable for loss or damage until the consignee receives the shipment.
Responsibilities
- Contracting Officers: Ensure the clause is included in applicable contracts and verify contractor compliance.
- Contractors: Must handle all aspects of delivery, including costs, risk, documentation, and compliance with packing and marking requirements.
- Agencies: Oversee contract performance and address any issues related to delivery or charges caused by Government actions.
Practical Implications
- This clause shifts all delivery risk and cost to the contractor, simplifying Government receipt of goods.
- Contractors must carefully manage logistics, documentation, and risk of loss up to delivery.
- Common issues include misunderstanding delivery points, improper documentation, or disputes over loss/damage responsibility.
As prescribed in 47.303-6(c), insert the following clause:
F.o.b. Destination (Jan 1991)
(a) The term "f.o.b. destination," as used in this clause, means-
(1) Free of expense to the Government, 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 forwarded 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) 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.
(End of clause)