FOB (Free on Board) is the most commonly used trade term, but in practice, it is used without reference to any version of the Incoterms® rules. In such cases, it is then up to the seller and buyer to agree in their contract on what they mean when they use these three letters. FOB has its origins in the days of sailing ships. In the Incoterms® 2020 rules, as in previous versions, FOB requires the seller to place the goods on board the vessel nominated by the buyer. From that point on risk of loss or damage to the goods transfers to the buyer. “On board” is no longer defined as placing the goods “across the ship’s rail” and, in fact, is not defined any further as it will be a matter for the contract to specify depending on the nature of the goods.