Short answer. Goods are in transit from the moment they are handed to a carrier or other bailee for transmission to the buyer until the buyer or his agent takes delivery from that carrier. They also stay in transit if the buyer rejects them and the carrier keeps holding them, even where the seller refuses to take them back.
What the law says
From the time when they are delivered to a carrier by land, water, or air, or other bailee for the purpose of transmission to the buyer, until the buyer, or his agent in that behalf, takes delivery of them from such carrier or other bailee
Civil Code, Article 1531 — When Goods Are 'In Transit'. Read the full provision →
Why the window matters
An unpaid seller whose buyer has become insolvent may stop goods in transitu — intercept them before they reach the buyer. That remedy is only alive while the goods are legally in transit, so this article decides whether the seller still has a real claim over the goods or is left with an unsecured money claim against a failing debtor. In practice the difference is enormous. Sellers who hesitate for a few days while chasing a buyer for payment often find the window has closed and the goods are gone. If you learn your buyer is in trouble while a shipment is moving, act immediately and take advice the same day.
When transit ends early
Transit stops before arrival if the buyer or his agent obtains delivery of the goods before their arrival at the appointed destination. It also stops once the goods have arrived and the carrier acknowledges to the buyer that he now holds them on the buyer's behalf and continues holding as bailee for the buyer — and the Code adds that it is immaterial that the buyer has indicated some further destination for the goods. So a buyer who onward-ships from a warehouse he controls has already ended the transit. Finally, a carrier who wrongfully refuses to deliver to the buyer ends it too; the seller cannot benefit from the carrier's own default.
Chartered vessels and vehicles
Where goods are delivered to a ship, freight train, truck or airplane chartered by the buyer, the Code refuses to give a flat answer. It is a question depending on the circumstances of the particular case whether the carrier holds as a carrier or as the buyer's own agent. If the vessel is effectively the buyer's, possession has passed and there is nothing to stop. Charterparty terms, who directs the vessel, and who bears risk all feed into that assessment — which is why sellers dealing with buyer-chartered transport should not assume the stoppage remedy will be available to them.
Part deliveries, and the limits of the rule
If part of the goods has already reached the buyer, the remainder may still be stopped, unless the part delivery was made in circumstances showing an agreement to give up possession of the whole. So a partial handover does not automatically forfeit the seller's rights over the rest, but a handover framed as completing the delivery can. Note what this article does not do: it does not create the right of stoppage, does not decide whether the buyer is insolvent, and does not settle title. It answers one question only — the timing. The mechanics of exercising stoppage, and the carrier's duties on receiving notice, belong elsewhere in the Code.