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CFR (Cost and Freight)

Abbreviation: CFR

Cost and Freight means the seller contracts and pays ocean freight to the destination port, but risk has already passed to the buyer once the goods are loaded on board at origin. There are therefore two critical points: the risk point at the port of loading and the cost point at the port of destination. The buyer should insure the cargo itself. CFR is for sea transport only; for containers, CPT is usually a better fit.

Related terms

  • FOB (Free On Board)

    Free On Board means the seller delivers the goods on board the vessel nominated by the buyer at the port of shipment; risk passes once the goods are on board.

  • CIF (Cost, Insurance and Freight)

    CIF works like CFR, but the seller must also take out cargo insurance for the buyer, at least at Institute Cargo Clauses (C) level and for at least 110% of the contract value.

  • CPT (Carriage Paid To)

    Carriage Paid To means the seller pays transport to the named destination, but risk passes to the buyer when the goods are handed to the first carrier.

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