CFR – Cost and Freight
Incoterms® 2020 rule: transfer of risk, cost sharing and customs responsibilities.
The CFR rule in brief
CFR (Cost and Freight) is a rule in Incoterms® 2020 that can be used only for sea and inland waterway transport: "Cost and freight". It sets, in the sales contract, how delivery of the goods and costs and risks are shared between seller and buyer.
When does risk transfer?
When the goods are loaded on board the vessel
Export clearance
The seller
Import clearance
The buyer
Seller's obligations
Pays the freight to the destination port; risk passes to the buyer once the goods are loaded on board.
Buyer's obligations
Arranges insurance and handles unloading and import clearance at the destination port.
When is it used?
Used in sea freight where the seller manages freight and insurance is left to the buyer.
This page is for general information; for the full scope of rights and obligations, see the ICC's official Incoterms® 2020 text and your contract terms.
Frequently asked questions
What is CFR?
CFR (Cost and Freight) is a rule in Incoterms® 2020 that can be used only for sea and inland waterway transport: "Cost and freight". It sets, in the sales contract, how delivery of the goods and costs and risks are shared between seller and buyer.
What is the difference between CFR and CIF?
CFR: Pays the freight to the destination port; risk passes to the buyer once the goods are loaded on board. CIF: In addition to CFR obligations, takes out minimum cargo insurance under ICC (C).