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Incoterms - Wikipedia, the free encyclopedia

Incoterms
From Wikipedia, the free encyclopedia

The Incoterms rules or International Commercial Terms are a series of pre-defined commercial terms published by the International Chamber of Commerce (ICC) that
are widely used in International commercial transactions or procurement processes. A series of three-letter trade terms related to common contractual sales practices, the
Incoterms rules are intended primarily to clearly communicate the tasks, costs, and risks associated with the transportation and delivery of goods.
The Incoterms rules are accepted by governments, legal authorities, and practitioners worldwide for the interpretation of most commonly used terms in international trade.
They are intended to reduce or remove altogether uncertainties arising from different interpretation of the rules in different countries. As such they are regularly incorporated
into sales contracts[1] worldwide.
First published in 1936, the Incoterms rules have been periodically updated, with the eighth version—Incoterms 2010—having been published on January 1, 2011.
"Incoterms" is a registered trademark of the ICC.

Contents
1 Incoterms 2010
1.1 EXW – Ex Works (named place of delivery)
1.2 CPT – Carriage Paid To (named place of destination)
1.3 CIP – Carriage and Insurance Paid to (named place of destination)
1.4 DAT – Delivered at Terminal (named terminal at port or place of destination)
1.5 DAP – Delivered at Place (named place of destination)
1.6 DDP – Delivered Duty Paid (named place of destination)
1.7 Sea and inland waterway transport
1.7.1 FAS – Free Alongside Ship (named port of shipment)
1.7.2 FOB – Free on Board (named port of shipment)
1.7.3 CFR – Cost and Freight (named port of destination)
1.7.4 CIF – Cost, Insurance and Freight (named port of destination)
2 The seller responsibilities based on Incoterms 2010
3 Previous terms from Incoterms 2000 eliminated from Incoterms 2010
3.1 DAF – Delivered at Frontier (named place of delivery)
3.2 DES – Delivered Ex Ship (named port of delivery)
3.3 DEQ – Delivered Ex Quay (named port of delivery)
3.4 DDU – Delivered Duty Unpaid (named place of destination)
4 See also
5 References
6 External links

National Incoterms chambers.

Incoterms 2010
The eighth published set of pre-defined terms, Incoterms 2010 defines 11 rules, reducing the 13 used in Incoterms 2000 by introducing two new rules ("Delivered at
Terminal", DAT; "Delivered at Place", DAP) that replace four rules of the prior version ("Delivered at Frontier", DAF; "Delivered Ex Ship", DES; "Delivered Ex Quay",
DEQ; "Delivered Duty Unpaid", DDU).[2] In the prior version, the rules were divided into four categories, but the 11 pre-defined terms of Incoterms 2010 are subdivided
into two categories based only on method of delivery. The larger group of seven rules applies regardless of the method of transport, with the smaller group of four being
applicable only to sales that solely involve transportation over water.

EXW – Ex Works (named place of delivery)
The seller makes the goods available at his/her premises. The buyer is responsible for uploading. This term places the maximum obligation on the buyer and minimum
obligations on the seller. The Ex Works term is often used when making an initial quotation for the sale of goods without any costs included. EXW means that a buyer incurs
the risks for bringing the goods to their final destination. The seller does not load the goods on collecting vehicles and does not clear them for export. If the seller does load the
goods, he does so at buyer's risk and cost. If parties wish seller to be responsible for the loading of the goods on departure and to bear the risk and all costs of such loading,
this must be made clear by adding explicit wording to this effect in the contract of sale.
The buyer, arranges the pick up of the freight from the supplier's designated ship site, owns the intransit freight, and is responsible for clearing the goods through Customs. The
supplier is responsible for completing all the export documentation. Cost of goods sold transfers from the seller to the buyer at this time also.In this matter the buyer need to
take responsible for bring the material from the seller.

CPT – Carriage Paid To (named place of destination)
The seller pays for carriage. Risk transfers to buyer upon handing goods over to the first carrier at place of shipment in the country of export.
This term is used for all kind of shipments.

CIP – Carriage and Insurance Paid to (named place of destination)
en.wikipedia.org/wiki/Incoterms

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warehouse.org/wiki/Incoterms 2/4 . However. insurance. The passing of risk occurs when the goods are in buyer account. CIF – Cost. The seller is not responsible for unloading. rail or air cargo terminal. Maritime transport only. The seller responsibilities based on Incoterms 2010 en. Insurance for the goods is NOT included. ready for unloading from the arriving conveyance. DAT – Delivered at Terminal (named terminal at port or place of destination) The Seller delivers when the goods. (An important difference from Delivered At Terminal DAT. DAP – Delivered at Place (named place of destination) Can be used for any transport mode. The buyer pays cost of marine freight transportation. or where there is more than one transport mode. or C+F). The buyer must clear the goods for export because he did not pay for the goods in the country of origin. This term has been greatly misused over the last three decades ever since Incoterms 1980 explained that FCA should be used for container shipments. ICC publication 715). loading cost. It means the seller pays for transportation of goods to the port of shipment. Insurance and Freight (named port of destination) Exactly the same as CFR except that the seller must in addition procure and pay for the insurance. but risk passes when the goods are handed over to the first carrier.Wikipedia. This term is typically used for heavy-lift or bulk cargo. whether covered or not. The seller is responsible for arranging carriage and for delivering the goods. Maritime transport only. once unloaded from the arriving means of transport. The seller must instruct the buyer the details of the vessel and the port where the goods are to be loaded. risk is transferred to the buyer once the goods are loaded on the vessel. and there is no reference to. Suitable only for maritime transport but NOT for multimodal sea transport in containers (see Incoterms 2010. such as a quay.) DDP – Delivered Duty Paid (named place of destination) Seller is responsible for delivering the goods to the named place in the country of the buyer. container yard or road. [Link below] The four rules defined by Incoterms 2010 for international trade where transportation is entirely conducted by water are: FAS – Free Alongside Ship (named port of shipment) The seller must place the goods alongside the ship at the named port. FOB – Free on Board (named port of shipment) The buyer must advance government tax in the country of origin as commitment to load the goods on board a vessel designated by the buyer. This term is often used in place of the non-Incoterm "Free In Store (FIS)". Cost and risk are divided when the goods are actually on board of the vessel. please refer to 'United Nations Code for Trade and Transport Locations (UN/LOCODE)'. CFR – Cost and Freight (named port of destination) Seller must pay the costs and freight to bring the goods to the port of destination. This term places the maximum obligations on the seller and minimum obligations on the buyer. ICC publication 715). Sea and inland waterway transport To determine if a location qualifies for these four rules. The seller must clear the goods for export. and pays all costs in bringing the goods to the destination including import duties and taxes. 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. The term is applicable for maritime and inland waterway transport only but NOT for multimodal sea transport in containers (see Incoterms 2010. This term is formerly known as CNF (C&F. "Terminal" includes any place. the free encyclopedia The containerized transport/multimodal equivalent of CIF. where the seller is responsible for unloading.12/25/13 Incoterms . uploading and transportation cost from the arrival port to destination. or provision for. at the named place.wikipedia. Seller pays for carriage and insurance to the named destination point. the use of a carrier or forwarder. are placed at the Buyer's disposal at a named terminal at the named port or place of destination.

but the passing of risk does not occur until the goods have been unloaded at the port of discharge. dry chemicals. A transaction in international trade where the seller is responsible for making a safe delivery of goods to a named destination. 2013.com/Product/ProductInfo. Costs for unloading the goods and any duties. but also Risk and Title up to the arrival of the vessel at the named port.unece. and where the seller either owns or has chartered. The seller pays for transportation to the named place of delivery at the frontier.org/cefact/locode/service/location.iccbooks.iccwbo.aspx?id=657). the seller has agreed to bear not just cost.html?id=40772). DDU – Delivered Duty Unpaid (named place of destination) This term means that the seller delivers the goods to the buyer to the named place of destination in the contract of sale.12/25/13 Incoterms . ICC. where the buyer becomes responsible for paying the duty and other customs clearing expenses. ICC.org/w/index. paying all transportation expenses but not the duty. External links Official website (http://www. taxes. The passing of risk occurs at the frontier.org/Incoterms/index. 2011. Retrieved January 29.Wikipedia. The buyer arranges for customs clearance and pays for transportation from the frontier to his factory. ^ "From the introduction of Incoterms 2010" (http://www.org/wiki/Incoterms 3/4 .php?title=Incoterms&oldid=586746924" Categories: International trade Commercial item transport and distribution International commerce terms en. DES – Delivered Ex Ship (named port of delivery) Where goods are delivered ex ship.html) References 1. The seller pays the same freight and insurance costs as he would under a CIF arrangement.org/incoterms) Retrieved from "http://en. their own vessel. A commonly used term in shipping bulk commodities.wikipedia. 2.· See also Commercial law International trade International trade law Uniform Commercial Code United Nations Convention on Contracts for the International Sale of Goods United Nations Code for Trade and Transport Locations (UN/LOCODE) (http://www.wikipedia. DEQ – Delivered Ex Quay (named port of delivery) This is similar to DES. grain. the passing of risk does not occur until the ship has arrived at the named port of destination and the goods made available for unloading to the buyer. Unlike CFR and CIF terms. such as coal. The seller bears the risks and costs associated with supplying the goods to the delivery location. Retrieved May 16. the free encyclopedia Loading on Transport vehicle export declaration EXW No No FCA Yes Yes FAS Yes Yes FOB Yes Yes CFR Yes CIF Yes DAT DAP transport to the export port unloading of the vehicle in the export port No loading fees in export port transport to the import port unloading fees in import port loading to the transport vehicle in import port transport to the delivery address custom fees tax fees insurance No No No No No No No No No No No No No No No No No No No Yes Yes No No No No No No No No Yes Yes Yes No No No No No No No Yes Yes Yes Yes Yes No No No No No No Yes Yes Yes Yes Yes No No No No No Yes Yes Yes Yes Yes Yes Yes Yes No No No No No Yes Yes Yes Yes Yes Yes Yes Yes Yes No No No CPT Yes Yes Yes Yes Yes Yes Yes Yes Yes No No No CIP Yes Yes Yes Yes Yes Yes Yes Yes Yes No No Yes DDP Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Previous terms from Incoterms 2000 eliminated from Incoterms 2010 DAF – Delivered at Frontier (named place of delivery) This term can be used when the goods are transported by rail and road.iccwbo. etc. ^ "ICC Guide to Incoterms® 2010" (http://www. are for the Buyer.

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