SECURE FOB Transaction Procedure for Diesel Fuel (Port of Loading)

“At Shira Nati Ltd, we streamline international fuel trading under strict FOB Incoterms, ensuring seamless compliance from pre-contract validation to vessel loading.
Our secure framework utilizes non-operative SBLC/LC protocols and independent Q&Q inspections directly at the Port of Loading.
By clarifying operational boundaries and risk transfer at the ship’s rail, we provide global buyers and sellers with financial security, transparent logistics, and absolute quality verification before departure.”

Buyer sends LOI
Seller sends SCO
When The Buyer and Seller Agree About the Price the procedure starts:
Stage 1

Pre-Contract & Authorization Filtering (Eliminating Ghost Participants)

Strategic Logic for both parties: In FOB transactions, this phase eliminates fake buyers and ghost sellers immediately. By requiring an ATS alongside logistical intent, both parties prove they possess real allocation rights and serious intent, preventing scams before any operational data is shared.
  • NCNDA and Profile Exchange: Both parties and facilitators sign an ICC-compliant NCNDA. The Seller provides its corporate registration profile, and the Buyer presents its corporate profile.
  • Verification of Authority to Sell (ATS): The Seller provides a valid Authorization to Sell (ATS) or an official Allocation Certificate. This guarantees to the Buyer that the Seller has explicit legal authority to market this specific fuel volume from the terminal/refinery.
  • Sanitized Document Exchange: The Seller provides a recent, redacted SGS specification report to confirm product compatibility, while the Buyer provides an initial, non-binding Letter of Intent (LOI) to align target terms.
  • Issuance of Conditional ICPO: The Buyer issues a formal Irrevocable Corporate Purchase Order (ICPO) accompanied by banking details, stating clearly that the order is legally conditional upon a successful Dip Test and product verification.
Stage 2

Contract Execution & Logistical Readiness (Securing Infrastructure & Capital)

Strategic Logic for both parties: This stage ensures that the operational infrastructure is fully ready to handle the transfer. By confirming both shipping/storage capacity and backing it with a locked financial instrument, the trade is shielded against logistical delays and defaults.
  • SPA Signing: The Seller issues the formal Sales and Purchase Agreement (SPA). Both parties review, endorse, and sign the contract.
  • Logistical Infrastructure Presentation:
    • For Tank-to-Vessel (TTV): The Buyer provides a valid Charter Party Agreement (CPA) and Notice of Readiness (NOR) showing their vessel is ready to load.
    • For Tank-to-Tank (TTT): The Buyer provides a valid Tank Storage Agreement (TSA) showing they have leased space ready to receive the product.
  • Issuance of Non-Operative Financial Security: The Buyer opens a Non-Operative Letter of Credit (L/C or SBLC) to secure the purchase value. The instrument remains dormant and safe until physical verification is complete.
Stage 3

Unconditioned Access & Physical Dip Test (Zero Upfront Fee Auditing)

Strategic Logic for both parties: This is the ultimate defense against upfront-fee scams. The Seller grants unconditional verification access without asking for upfront storage or admin fees, and the Buyer funds their own independent inspection to ensure the product is 100% genuine.
  • Issuance of Partial POP & Unconditional DTA: The Seller issues a Partial POP package directly to the Buyer, including a Statement of Product Availability, Product Certificate of Origin, and Unconditional Dip Test Authorization (DTA) along with an Authorization to Verify (ATV).
    Note: The Seller pays for their own storage; the Buyer never pays any upfront tank fees or extension costs to the Seller's facility.
  • Physical Inspection (Dip Test): The Buyer’s appointed independent inspection team (e.g., SGS) accesses the Seller's shore tanks at the Buyer's expense to conduct a fresh Dip Test for Quality and Quantity (Q&Q).
Stage 4

Arrival, Injection & Settlement (Ownership and Title Transfer)

Strategic Logic for both parties: The final execution stage is safe and swift. The Seller only injects product that has just passed inspection, and the Buyer only releases the final wire transfer once the fuel is safely inside their vessel or designated tanks.
  • Product Injection: Upon a successful and clean SGS Dip Test report, the Seller commences and completes the injection of the product into the Buyer’s vessel or designated shore tanks, issuing a Full Injection Report.
  • Final Settlement & Title Transfer: Within 24 hours of injection completion, the Buyer’s bank activates the financial instrument and releases 100% of the commercial invoice value via MT103/TT wire transfer. The Seller immediately issues the official Title Transfer Certificate, passing full legal ownership of the product to the Buyer.

Critical Compliance Alerts for FOB Transactions

The following deviations indicate a high probability of a financial scam and are strictly non-acceptable under standard FOB Incoterms:

The "Tank Storage Lease Extension" Scam: The Seller states that to issue a valid Tank Storage Receipt (TSR) or to grant Dip Test access (DTA), the Buyer must pay to extend the lease of the Seller's shore tanks for a few days (usually 3 to 5 days). They will direct the Buyer to a fake tank farm administration company. Under FOB terms, the Seller must maintain and pay for their own storage up until the point of injection. Any request for tank leasing fees is a complete scam.
The "Dip Test Authorization Fee" or "Port Security Pass": The Seller demands that the Buyer pay a "registration fee" or "security pass fee" directly to the port or terminal lab to allow the SGS inspection team to enter the facility. Legitimate terminals do not charge buyers for standard access authorization under an unconditional DTA.
The "10% Upfront Title Transfer Deposit": The Seller claims they have injected the product or are ready to inject, but demands a 10% cash deposit prior to allowing the Buyer to conduct their own independent Dip Test. No payment is ever released based on the Seller's own paperwork or previous SGS reports; full inspection must occur first.
Secure FOB Transaction Procedure Flowchart for International Fuel Trading
Knowledge Hub

The Core FOB Transaction Procedure

Establishing a secure FOB Transaction Procedure is absolute key for professional trading entities dealing in global fuel and petroleum commodities[cite: 1]. Stage 1 of a legitimate process focuses on rigorous pre-contract and authorization filtering to eliminate fake participants[cite: 1]. At Shira Nati Ltd, we demand a verified Authorization to Sell (ATS) and signed NCNDA agreements before sharing sensitive trade data, ensuring a transparent FOB Transaction Procedure[cite: 1].

Contract Execution and Logistical Readiness

The second stage of our FOB Transaction Procedure protocol ensures complete infrastructural alignment[cite: 1]. Once the formal Sales and Purchase Agreement (SPA) is fully executed, buyers present their logistical readiness via a Charter Party Agreement (CPA) or Tank Storage Agreement (TSA)[cite: 1]. Financial security is maintained during this FOB Transaction Procedure by issuing a non-operative Standby Letter of Credit (SBLC), keeping transaction assets fully protected[cite: 1].

Unconditioned Access and Physical Dip Test

True risk mitigation requires physical validation at the loading port before any funds are moved[cite: 1]. Under a safe FOB Transaction Procedure, the seller provides an unconditional Dip Test Authorization (DTA) without demanding upfront storage extension fees[cite: 1]. According to commercial guidelines supported by the International Chamber of Commerce, the buyer's independent inspection team must have direct access to shore tanks to conduct quality audits[cite: 1].

Injection, Settlement and Ownership Transfer

The final execution phase of a clean FOB Transaction Procedure is swift, secure, and entirely bank-to-bank[cite: 1]. Upon a successful and clean inspection report verified by global audit authorities like SGS Inspection Services, product injection into the vessel begins[cite: 1]. Final commercial settlement via MT103 wire transfer occurs only after injection is complete, triggering the immediate release of the official Title Transfer Certificate[cite: 1].

Incoterms Compliance and Scam Prevention

Protecting your corporate interests means recognizing common compliance red flags within the global energy sector[cite: 1]. A standard FOB Transaction Procedure never requires the buyer to pay upfront tank storage lease extensions, port security fees, or title deposits before an independent inspection takes place[cite: 1]. To explore our full bulk product capabilities, navigate directly to our international Product Catalog or contact our energy trading desk.

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