The Incoterms rules are an internationally recognized standard and are used worldwide in international and domestic contracts for the sale of goods. First published in 1936 and the most recent revision in 2010, Incoterms rules provide internationally accepted definitions and rules of interpretation for most common commercial terms.
The rules have been developed and maintained by experts and practitioners brought together by the International Chamber of Commerce and have become the standard in international business rules setting.
Rules for Any Mode or Modes of Transport
(EXW) Ex Works
The seller delivers when it places the goods at the disposal of the buyer at the seller’s premises or at another named place such as a factory or warehouse. The seller does not need to load the goods on any collecting vehicle and does not need to clear the goods for export, where such clearance is applicable.
(FCA) Free Carrier
The seller delivers the goods to the carrier or another person nominated by the buyer at the seller’s premises or another named place. The parties are well advised to specify as clearly as possible the point within the named place of delivery, as the risk passes to the buyer at that point.
(CPT) Carriage Paid To
The seller delivers the goods to the carrier or another person nominated by the seller at an agreed place (if any such place is agreed between parties) and that the seller must contract for and pay the costs of carriage necessary to bring the goods to the named place of destination.
(CIP) Carriage and Insurance Paid To
The seller delivers the goods to the carrier or another person designated by the seller at an agreed upon location and the seller must contract for and pay the costs of any carriage necessary to bring the goods to the named place of destination.
(DAT) Delivered At Terminal
The seller delivers the goods and once unloaded from the arriving means of transport, goods are placed at the disposal of the buyer at a named terminal, at the named port or place of destination. “Terminal” includes a place, whether covered or not, such as a warehouse, container yard or road, rail or air cargo terminal. The seller bears all risks involved in bringing the goods to and unloading them at the terminal at the named port or place of destination.
(DAP) Delivered At Place
The seller delivers when the goods are placed at the disposal of the buyer on the arriving means of transport ready for unloading at the named place of destination. The seller bears all risks involved in bringing the goods to the named place.
(DDP) Delivered Duty Paid
The seller delivers the goods when the goods are placed at the disposal of the buyer, cleared for import on the arriving means of transport ready for unloading at the named place of destination. The seller bears all the costs and risks involved in bringing the goods to the place of destination and has an obligation to clear the goods not only for export but also for import, to pay any duty for both export and import and to carry out all customs formalities.
Rules for Sea and Inland Waterway Transport
(FAS) Free Alongside Ship
The seller delivers when the goods are placed alongside the vessel nominated by the buyer at the named port of shipment. The risk of loss of or damage to the goods passes when the goods are alongside the ship, and the buyer bears all costs from that moment onwards.
(FOB) Free On Board
The seller delivers the goods on board the vessel nominated by the buyer at the named port of shipment or procures the goods already so delivered. The risk of loss of or damage to the goods passes when the goods are on board the vessel, and the buyer bears all costs from that moment forward.
(CFR) Cost and Freight
The seller delivers the goods on board the vessel or procures the goods already delivered. The risk of loss of or damage to the goods passes when the goods are on board the vessel. The seller must contract for and pay the costs and freight necessary to bring the goods to the named port of destination.
(CIF) Cost, Insurance and Freight
The seller delivers the goods on board the vessel or procures the goods already delivered. The risk of loss of or damage to the goods passes when the goods are on board the vessel. The seller must contract for and pay the costs and freight necessary to bring the goods to the named port of destination.
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