Also called: Cost and Freight
Freight to destination, delivery still at origin
The seller must contract for carriage to the named destination port and deliver the goods on board at origin. The buyer takes risk from that on-board delivery. Import clearance remains the buyer’s typical job under the rule. Name the destination port; “CFR Mediterranean” is not a place.
No seller insurance duty under CFR
CFR is how a seller can include ocean freight in the price without taking arrival risk and without a duty, under the rule itself, to buy cargo insurance. The buyer who wants cover must arrange it or write named cover into the contract. Ask for CIF, or an added insurance clause, if the seller must purchase the policy.
Who pays what under CFR
Seller: on-board delivery at origin, main freight to the named destination port, export clearance under the usual allocation, and the transport document the contract requires. Buyer: risk from on-board, insurance unless added, import clearance, and onward costs after discharge unless the freight contract and the sale contract already allocate them.
CFR versus CIF
Same freight story, different insurance story. Under CIF the seller must obtain minimum insurance for the buyer’s risk during carriage, on the terms the Incoterms 2020 CIF rule requires. Under CFR that duty is absent. A cheaper CFR number can be more expensive once insurance is added, or it can be what the buyer prefers if they already have an open cover.
What CFR does not settle
Arrival risk remaining with the seller. Seller-purchased cargo insurance. Unloading costs at destination unless the freight contract already includes them and the parties have allocated them. Payment terms. Title.
CFR-specific mistakes
Treating CFR as “seller on risk until the destination port”. Using CFR for containers when CPT would match the actual hand-over. Forgetting discharge and terminal charges that the ocean freight may exclude.
TTC uses these terms in its RFQ and transaction process. Nothing on this page is a licence, a certification, a guarantee of clearance, or a substitute for the documents and clauses of a specific contract.