When international oil prices experience sharp fluctuations, shipping costs inevitably follow suit. To offset the additional expenses caused by rising fuel prices, shipping companies often impose a fee known as the Emergency Bunker Surcharge (EBS) . But who is ultimately responsible for covering this cost?
The EBS, or Emergency Bunker Surcharge , is a fee levied by shipping companies to balance the increased fuel costs resulting from volatility in global crude oil and refined petroleum prices. Crucially, under standard trade terms, the EBS is not classified as a local cost in Free On Board (FOB) agreements. This means that, in principle, exporters operating under FOB terms are not obligated to pay the EBS.
However, in practice, some shipping companies may attempt to pass the EBS cost onto FOB clients. This typically occurs when carriers struggle to collect the fee from other parties. If an FOB customer is asked to pay the EBS, it is advisable to promptly engage with the buyer to clarify responsibility for the charge. The payment method for EBS is also flexible—it can be settled either in advance or upon delivery, depending on mutual agreement.
In summary, while the EBS is not inherently an FOB local charge, real-world scenarios may deviate from this principle. Exporters should remain vigilant and maintain clear communication to avoid unexpected financial burdens.