Forwarders Certificate of Receipt (FCR)

A Forwarders Certificate of Receipt (FCR) is a document issued by a freight forwarder certifying that the freight forwarder has taken control of a specific cargo and is irrevocably bound to follow further instructions of the consignee named in the receipt. The document is issued by the freight forwarder following the order of the cargo supplier, but the purpose is for the supplier to lose control of the cargo in favour of the named consignee. The freight forwarder acts as a third party providing guarantee to the consignee that after the receipt is issued, the cargo is actually at the disposal of the consignee and the supplier cannot hinder the fulfilment of consignee’s instructions. For this reason, after the receipt is issued, the freight forwarder cannot accept subsequent orders from the supplier, but only from the named consignee. In this regard, in addition to physical control over the cargo, the freight forwarder must have received from the supplier payment or security for all expenses and remuneration, as well as all documents necessary for the export and dispach of the cargo. Thus, the freight forwarder is sure that consignee’s instructions can be fulfilled without any assistance from the supplier. The freight forwarder surrenders the original receipt to the cargo supplier and from that moment ceases to fulfill any further instructions from supplier’s side with respect to the cargo described in the receipt. The FCR is non-negotiable. The return of the original FCR back to the freight forwarder does not automatically restore supplier’s control over the cargo as the explicit confirmation of the consignee is also required. There is no requirement for the freight forwarder to be a physical operator of the terminal where the cargo is received as subcontractor may be used, but it is mandatory for the freight forwarder to be able to exercise control over any subsequent cargo operations.

The FCR is used as a primary document securing payments between traders, most often documentary credits, CAD or other instruments for conditional payment for goods. The International Federation of Freight Forwarders Associations (FIATA) has a specially developed form of FIATA FCR, which can only be used by freight forwarders who are FIATA members and have the relevant mandatory insurance of their liability to the principal. FIATA FCR forms provided to freight forwarders bear special number format and are subject to reporting. These requirements and restrictive conditions make FIATA FCR a reliable and preferred FCR form for international trade transactions.