When goods are shipped with the condition Free on Board (FOB), the seller is responsible for preparing the goods for shipping and loading them onto the ship for transport. The buyer is then responsible for paying the cost of transportation and any fees imposed at the eventual port of call. Insurance, if necessary, is also the buyer’s responsibility, as the risk of loss transfers to the buyer upon the seller loading the goods onto the transport. The term FOB can only be used in situations where goods are being shipped by land or sea.