Incoterm 2020 MMMC

DAW OHN MAR MAW
MIFFA
Central Executive Committee Member & Joint Secretary General 1 in MIFFA (Myanmar Int’l
Freight Forwarders’ Association)
Central Executive Committee Member & Joint Secretary General 2 in UMFCCI (Union of
Myanmar Chamber of Commerce/Trade & Investment Committee/MBI)
Daw Ohn Mar Maw who is the Executive Director of Awards Group of Companies
which is the leading “Supply Chain and Logistics” Management Company in
Myanmar. Doing Logistics, NVOCC, Freight Forwarding, Trucking and Warehousing,
Business Consultant under Awards Group of Companies.
She represent as a Board of Director of Myanmar Logistics Development Company
Limited which is Logistics leading company organized by industry association MIFFA.
She also the Managing Director of 24K Group which is doing Trading . Under
KEDMA Myanmar, she is acting Executive Director and its lines of business are
Retails and Distribution.
In Community Service, she is doing Chairlady of Project Committee 2018~2019
DAW OHN MAR MAW (Rotary Club of Central Yangon). Secretary of Myanmar Women and Children
+959 501 3709 Development Foundation (MWCDF) as well as she is the Professional Trainer of
International Organisation MIFFA, FIATA, AFFA, ADB, MCD and UNESCAP. She is
ohnmarmaw2008@gmail.com working at ITC (International Trade Centre) as a National Consultant in Logistics
Sector of Myanmar.
1 2
Objectives
• To define Incoterms
• To define obligation of seller and buyer
• To be able to suggest the appropriate term
2 3
Standard meaning of terminology used in transactions and trade
documents. ...
• Understanding between a buyer and a seller
• The discounts
• Payment period
• Delivery expenses and time
• Returns
3 4
WHAT IS “INCOTERMS” ?
a standardized trade terms
• (13 in total for INCOTERMS 2000)
• (11 for INCOTERMS 2010)
• (11 for INCOTERMS 2020)
dealing with delivery conditions
between buyer & seller;

developed by ICC, the main purpose is to apportion the
costs & risks of the transport movement & related
operations between the 2 parties.
4 5
What is Incoterms?
• Set of uniform rules
• Set out clearly the right and obligation of Buyer and Seller in international
and domestic transaction*.
• Trade terms that released by International Chamber of Commerce.
• The Incoterms 2020 rules take account of changes in transport practice,
together with the spread of customs-free zones, increased use of electronic
communication and security issues.
5 6
Why Incoterms?
1. Transfer of risk-
when the seller has the right to claim for the contract price even if the goods are
lost, damaged or short-delivered.
2. Transfer of obligations-
where and how the seller must make the goods available to the buyer and how the
buyer must take delivery of the goods.
3. Division of costs-
how the normal costs relating to the export and import of goods should be divided
between the seller and the buyer.
6 7
Development of Incoterms
• First Published in 1936
• Revised in 1953, 1967, 1976, 1980,
1990, 2000, 2010
• Incoterms 2020 is launched
7 8
History of INCOTERMS
First Publication 1936 Global Guidelines for traders
ONLY SEA TRANSPORTATION:
FAS, FOB, C&F, CIF, Ex Ship, Ex Quay
8 9
Second Publication 1953 Adding Transportation by Rail
FAS, FOB, C&F, CIF, Ex Ship, Ex Quay adding DCP (Delivery Costs Paid),
FOR (Free on Rail), and FOT (Free on Truck)
Third Version 1967 Adding two new terms

DAF (Delivery at Frontier), DDP ( Delivery at Destination)
Fourth Version 1967 Adding FOB Airport
9 10
Fifth Version in 1980 Growth of Container Transport : adding
FRC (Free Carrier….Named at Point)
Sixth Version in 1990 Better shape of revision
Deleted FOR, FOT, FOB Airport as FCA can be appropriate used .
10 11
Seventh Version Year 2000
FAS and DEQ were modified to comply with the customs clearance
obligations.
Eighth Version Year 2010

Deleted DAF, DES, DEQ, DDU and added DAT, DAP including string
sales
11 12
2000, 13 individual Incoterms
1. Ex-Works (EXW)
2. Free Carrier (FCA)
3. Free Alongside Ship (FAS)
4. Free On Board (FOB)
5. Carriage and Freight (CFR)
6. Carriage Insurance and Freight (CIF)
7. Carriage paid to (CPT)
8. Carriage and Insurance paid to (CIP)
9. Delivered at Frontier (DAF)
10. Delivered Ex-Ship (DES)
11. Delivered Ex-Quay (DEQ)
12. Delivered Duty Unpaid (DDU)
13. Delivery Duty Paid (DDP)
12 13
RULES FOR SEA AND INLAND WATERWAY TRANSPORT
1. FAS FREE ALONGSIDE SHIP
2. FOB FREE ON BOARD
3. CFR COST AND FREIGHT
4. CIF COST INSURANCE AND FREIGHT
13 14
RULES FOR ANY MODE OR MODES OF TRANSPORT
1. EXW EX WORKS
2. FCA FREE CARRIER
3. CPT CARRIAGE PAID TO
4. CIP CARRIAGE AND INSURANCE PAID TO
5. DAT DELIVERED AT TERMINAL
6. DAP DELIVERED AT PLACE
7. DDP DELIVERED DUTY PAID
14
Division of Classes(Incoterms2010)
Any Mode or Modes of Sea and Inland Waterways
Transport Transport
EXW
FCA FAS, FOB
CPT, CIP CFR, CIF
DAT, DAP, DDP
15 16
16 17
INCOTERMS 2010
A B C D E F G H I J K L M
Export- Unloading of Loading Carriage to Unloading Loading on Import

Loading on Carriage to Carriage to place
Incoterm Customs truck in port of charges in port of charges in port truck in port Insurance customs Import taxes
truck port of export of destination
declaration export port of export import of import of import clearance
1 EXW Buyer Buyer Buyer Buyer Buyer Buyer Buyer Buyer Buyer N/A Buyer Buyer
2 FCA Seller Seller Seller Buyer Buyer Buyer Buyer Buyer Buyer N/A Buyer Buyer
3 FAS Seller Seller Seller Seller Buyer Buyer Buyer Buyer Buyer N/A Buyer Buyer
4 FOB Seller Seller Seller Seller Seller Buyer Buyer Buyer Buyer N/A Buyer Buyer
5 CFR Seller Seller Seller Seller Seller Seller Buyer Buyer Buyer N/A Buyer Buyer
6 CIF Seller Seller Seller Seller Seller Seller Buyer Buyer Buyer Seller Buyer Buyer
7 DAT Seller Seller Seller Seller Seller Seller Seller Buyer Buyer N/A Buyer Buyer
8 DAP Seller Seller Seller Seller Seller Seller Seller Seller Seller N/A Buyer Buyer
9 CPT Seller Seller Seller Seller Seller Seller Seller Seller Seller N/A Buyer Buyer
10 CIP Seller Seller Seller Seller Seller Seller Seller Seller Seller Seller Buyer Buyer
11 DDP Seller Seller Seller Seller Seller Seller Seller Seller Seller N/A Seller Seller
17 18
RULES FOR SEA AND INLAND WATERWAY TRANSPORT
1. FAS FREE ALONGSIDE SHIP
2. FOB FREE ON BOARD
3. CFR COST AND FREIGHT
4. CIF COST INSURANCE AND FREIGHT
18 19
RULES FOR ANY MODE OR MODES OF TRANSPORT
1. EXW EX WORKS
2. FCA FREE CARRIER
3. CPT CARRIAGE PAID TO
4. CIP CARRIAGE AND INSURANCE PAID TO
5. DPU DELIVERED AT PLACE UNLOADED
6. DAP DELIVERED AT PLACE
7. DDP DELIVERED DUTY PAID
19 20
Diagram of the Incoterms 2020
CPT
CIP
FCA FAS FOB CFR
EXW
CIF
DPU
DAP
DDP
20 21
INCOTERMS 2020
A B C D E F G H I J K L M
Export- Unloading of Loading Carriage to Unloading Loading on Import

Loading on Carriage to Carriage to place
Incoterm Customs truck in port of charges in port of charges in port truck in port Insurance customs Import taxes
truck port of export of destination
declaration export port of export import of import of import clearance
1 EXW Buyer Buyer Buyer Buyer Buyer Buyer Buyer Buyer Buyer N/A Buyer Buyer
2 FCA Seller Seller Seller Buyer Buyer Buyer Buyer Buyer Buyer N/A Buyer Buyer
3 FAS Seller Seller Seller Seller Buyer Buyer Buyer Buyer Buyer N/A Buyer Buyer
4 FOB Seller Seller Seller Seller Seller Buyer Buyer Buyer Buyer N/A Buyer Buyer
5 CFR Seller Seller Seller Seller Seller Seller Buyer Buyer Buyer N/A Buyer Buyer
6 CIF Seller Seller Seller Seller Seller Seller Buyer Buyer Buyer Seller Buyer Buyer
7 DPU Seller Seller Seller Seller Seller Seller Seller Buyer Buyer N/A Buyer Buyer
8 DAP Seller Seller Seller Seller Seller Seller Seller Seller Seller N/A Buyer Buyer
9 CPT Seller Seller Seller Seller Seller Seller Seller Seller Seller N/A Buyer Buyer
10 CIP Seller Seller Seller Seller Seller Seller Seller Seller Seller Seller Buyer Buyer
11 DDP Seller Seller Seller Seller Seller Seller Seller Seller Seller N/A Seller Seller
21 22
Division of Classes(Incoterms2020)
Any Mode or Modes of Sea and Inland Waterways
Transport Transport
EXW
FCA FAS, FOB
CPT, CIP CFR, CIF
DPU, DAP, DDP
22 23
What is INCOTERMS?
• What is Incoterms rules
It is a set of international rules commonly used as trade term in
international trade, known as International Commercial Terms
It set out the Tasks or Obligations (Delivery), Risk, and allocation of

Costs between Seller and Buyers, released by International Chamber of
Commerce.
INCOTERM can be used as Trade Term both domestic and international

trade
23 24
What INCOTERMS does not deal with?
The transfer the title of Ownership of the goods
Specification of the goods sold
Payment method and currency
Compensation for breach of the sales contract
Prohibit of import & export, Sanctions, force majeure
IPR
Law of dispute ,
Consequences of delay in performance of contractual obligations
24 25
Key Changes INCOTERMS rules 2020
• Demonstrate the allocation of cost in A9 and B9
• Bill of Lading in FCA Term
• Different Level of insurance in CIF and CIP
• Change in title of DAT to DPU
• Trader carriage in FCA, DAP, DPU and DDP
• Security related requirements in carriage obligations and costs
25 26
Analyze INCOTERMS rules before use
• Address to articles related to the issue
• Delivery Point & Place of Destination

• Costs to bear
• Risk transfer point
• Insurance and else….
26 27
Solving problem of usage INCOTERMS
Obligations of SELLER Obligations of BUYERS
A1. General obligations B1. General obligations
A2. Delivery B2. Taking Delivery
A3. Transfer of Risks B3. Transfer of Risks
A4. Carriage B4. Carriage
A5. Insurance B5. Insurance
A6. Delivery/Transport Document B6. Delivery/Transport Document
A7. Export/Import Clearance B7. Export/Import Clearance
A8. Checking/Packing/Marking B8. Checking/Packing/Marking
A9. Allocation of Costs B9. Allocation of Costs
A10. Notices B10. Notices
27 28
EXW – EXWORKS (insert named place of delivery)
Delivery Buyer Cost
Buyer Risk
S B
Delivery
1. Seller has no duty to load the cargo onto Buyer truck, but
subject to contract of sales
2. Seller delivers the goods to buyer at the disposal of the
S buyer at the named place (Factory or warehouse)
Buyer fixes Transportation & Insurance
3. Such named place can be whether or not seller’s premise
4. Buyer has right to fix the place of delivery
28 29
Delivery
MTO services nominated by Buyer
S B
Delivery
1. MTO at origin pick up and book carrier, ship the goods

2. After arrival, MTO at destination, clear the goods and
deliver to Buyer
S
Buyer fixes Transportation & Insurance
MTO = Multimodal Transport Operator
29 30
Key point of obligation of Seller:
• Seller has no obligation to load the goods on any

colleting vehicle. Just leave the goods at the premise
awaiting for picking up by Consignee’s nominated
Carrier (MTO).
• Delivery must be done at the agreed date and place.
• Seller must provide Invoice and Packing List upon
request. Seller has no duty to make Export Customs
Clearance and any export permits.
30 31
• Seller must assist buyer in obtaining any documents

relating to exportation and permits.
• Seller must pay the costs of checking quality, weighing
counting including package of the goods.
31 32
Key point of obligation of Buyer:
• Buyer fixes the place where the goods shall be delivered.
• Delivery Point: can be at Factory or any agreed places. Buyer

must clearly fix the place of delivery and time, providing to
seller sufficient notice
• Buyer must provide appropriate evidence of having taken
delivery to Seller. It can be Forwarder Certificate of Receipt.
• All risks of loss of or damage to the goods starts from the time
they have been delivered.
• Buyer pays all cost of transport from the named place of
delivery including export/import clearance up to his premise.
32 33
OBLIGATION SELLER BUYER
INVOICE Shall provide according to Sales Contract
DELIVERY Placing at the disposal of buyer, no load. Fix the place, date and time of delivery
If No specific point and there are several providing sufficient notice to Seller
points available, Seller may select the
point that best suits its purpose. Deliver
on the agreed date or agreed period
RISK Until the goods have been delivered From the time of delivery
CARRIAGE To provide any information and security Arrange or contract the carriage at own cost
issues at buyer risk and cost
INSURANCE No Obligation No Obligation but should make
33 34

TRANSPORT No Obligation Must provide evidence (FCR)
DOCUMENT
EXPORT Only assisting to obtain at buyer cost and Carry out and pay for all clearance
CLEARANCE risk
Packing Must arrange at own cost No Obligation

/Marking/QC
COST Only Cost relating to the Goods, non of Pay all costs and any additional cost
transportation cost.
34 35
FCA - FREE CARRIER (insert named place of delivery)
Delivery
Buyer Cost and Risk
S B
Seller Cost
FIRST SCENARIO AT Seller Premise
S
Seller must load the goods onto the Buyer’s
collecting vehicle.
Seller’s risk ends at loading
point when the named place
is Seller’s premise Buyer fixes Transport & Insurance
35 36
Delivery
Buyer Cost and Risk
S B
Buyer nominates the named place of delivery

Seller Cost
SECOND SCENARIO AT Other Place nominated by

S Buyer
Seller must load the goods onto the Seller vehicle,
Seller’s risk ends at carrying the goods to the named other place and
unloading point ready for unloading at disposal of the carrier
nominated by Buyer
Buyer fixes Transport & Insurance
Delivery
36 37
• FCA term can be concluded by naming only the place of delivery,

however, it is advisable to clearly specify the precise point within the
name place of delivery.
• In case the precise point is not identified, Seller may deliver to the
point that best suits its purpose which that will become delivery
point.
37 38
• FIRST SCENARIO AT SELLER PREMISE:
• Seller must provide commercial invoice and the goods according to
sales contract.
• Seller must deliver the goods to the carrier nominated by the buyers
on the Agreed Date and at the time within the agreed period notified
by the buyer.
• Seller must load the goods on the mean of transport provided by the
Buyer or carrier nominated by Buyer.
38 39
• Seller must carry out the Export clearance, relevant formalities and
permits paying taxes and duties where applicable at its own costs.
• Seller must assist buyer at buyer’s request, cost and risk to obtain any
documents and/or information related to all transit/import clearance
and security requirements in those countries.
• Seller must provide the buyer at seller’s cost the proof of delivery,
such as Delivery Note.
39 40
• If buyer instructs carrier to issue Transport Document stating that the
goods have been loaded such as Bill of Lading, the seller must assist
buyer at buyer’s cost and risk in obtaining and provide the buyer such
transport document. In most cases, Seller will pay for this document
at his own cost.
• Seller has no obligation to make insurance but shall provide
information to buyer for obtaining insurance at buyer’s request, cost
and risk.
40 41
• Buyer must contract or arrange at its cost for the carriage of goods
from the named place of delivery unless if agreed, Seller must
contract or arrange at Buyer cost and risk for the carriage of goods.
• Buyer has no obligation to Seller to make insurance, but Buyer should
make insurance in order to protect its interests.
• Buyer must notify Seller the name of the carrier, time within the
period agreed for delivery, mode of transport, and the point where
the goods shall be delivered.
41 42
Buyer must arrange import clearance and pay all formalities charges
concerned at destination.
Buyer bears all risks of loss and damage to the goods if
a) Buyer fails to nominate a carrier or
b) Nominated carrier fails to take the goods into its charge:
from the Agreed date, or no agreed date, from the time selected by
Buyer or no such time or from the end of any agreed period for
delivery.
42 43
• SCOND SCENARIO AT BUYER NOMINATED PREMISE:

• Seller must load the goods on its own vehicle and deliver to the
named place nominated by Buyer, ready for unloading.
• Seller has no obligation to unload the goods at Buyer nominated
premise.
• The rest of seller’s obligation remains unchanged.
• Key point of obligation and risk of Buyer:
Take delivery and bear the risk since then.
43 44
DELIVERY Deliver the goods on agreed date/time Select time for delivery within the period
at own premise by Loading or at agreed
disposal of the carrier by the goods is
available on the Seller’s vehicle, Or
procure goods so delivered.
RISK Until the goods have been delivered 1. Fail to nominate carrier from the time of
delivery.
2. Carrier fails to take the goods into its
charge, then risk of loss and damage starts:
a) From agreed date or in absence of
agreed date
b)From time selected by Buyer or no such
time has been notified
c) From the end of any agreed period for
delivery
44 45
CARRIAGE No Obligation contract of carriage, but Arrange or contract the carriage at own cost
If agreed Seller must contract for carriage from the named place, except Seller arrange
and shall provide any information contract of carriage, if agreed
required by Buyer
TRANSPORT Must provide Proof of Delivery (Deliver If agreed, Buyer instruct carrier to issue
DOCUMENT Note) Transport document to Seller at Buyer cost
and risk.
CUSTOMS Must arrange Export clearance and other Import clearance is done by Buyer at its own
CLEARANCE formalities. Assist to Import clearance account. Assist to provide Export clearance
and security required by Buyer at Buyer’s information or document required by Seller
cost and risk at Seller’s cost and risk
Packing Must arrange at own cost No Obligation
/Marking/QC
Cost Cost until delivery, delivery note, duties Pay all costs relating to goods from time of
and taxes, assistance cost of buyer for delivery onwards
Export clearance 45 46
FAS – FREE ALONGSIDE SHIP (insert named port of
shipment) Delivery
Seller Cost & Risk Buyer Cost & Risk
S B
Seller Cost & Risk Delivery
Seller delivers the goods and place

S alongside ship at “Port / Quay or Barge
at Midstream”
NOT appropriate to apply for
Buyer fixes Transportation & Insurance CONTAINERISATED Transport
46 47
shipment)
Key point of Seller ‘s Obligation: Delivery
• Seller delivers the goods and places alongside the ship

nominated by Buyer at quay or by barge at the named port of
shipment.
• Caution: Port of shipment can be referred as Port Limit or
within the port limit area.
• Seller must procure goods already so delivered for shipment
(String Sales) in case of resell and Buyer become Seller for next
sales transaction.
• Seller must clear the goods for exportation in all process at
origin, but not for transit and47import clearance at destination. 48
shipment)
Key point of Seller ‘s Obligation: Delivery
• Seller must deliver the goods:

a) On the Agreed Date or
b) At the time within the agreed period by the buyer or,
c) If no such time is notified, then at the end of the agreed period and
in the manner customary at the port
Seller risks are ended up at ship side of the vessel nominated by Buyer
without loading the goods on board, excepts (buyer fails to….)
48 49
shipment)
Key point of Buyer ‘s Obligation: Risk starts
• From the shipside where Seller places the goods.
• But if:
a) Buyer fails to give notice of any transport-related security
requirements, vessel name, loading point and if any, the
selected delivery date within agreed period.
b) Vessel nominate by Buyer fails to arrive on time to enable
Seller to comply his delivery, fails to take the goods, closes for
cargo earlier than the time notified according to selected
delivery date within agreed period
Then, Buyer bears all risks of loss or damage to the goods.
49 50
shipment)
Key point of Buyer ‘s Obligation: Risk
Buyer bears all risks of loss or damage to the goods.
• From the agreed date, or in the absence of an agreed date

• From the date selected by Buyer within agreed period, or if no
such date has been notified.
• From the end of any agreed period for delivery
Providing that the goods have been clearly identified as the

contract goods.
50 51
shipment)
Key point of Buyer ‘s Risk
When Buyer ‘s risk starts??
1. Agreed date = both parties agreed so?
2. In the absence of Agreed date - No agreed date
3. Date Selected = Buyer’s specific date of delivery
4. No such date has been notified
5. The end of Agreed period = the range of time from starting to
ending, counting from ending date?? Such as “LAY/CAN”.
** No clearly definition of those Date and Time.

51 52
shipment)
Key point of Buyer ‘s Obligation:
• Buyer must contract at its own costs for the carriage of the
goods, nominating the carrier to bring in the ship to the
named port of shipment. Buyer must provide “Vessel name”
to Seller, not “Carrier Name” and loading point at the port of
shipment which it can be MID Stream of the port of shipment.
• Buyer must clear transit and import clearance and pay the
taxes and duty
Note:
Most of FAS will be used for commodity cargoes sales
52 53
shipment)
DELIVERY Placing the goods alongside the ship on Fix the place, date and time of delivery
the agreed date, time within agreed
period, and if no such time, then at the
end of agreed period and in manner of
customary at the port
RISK Transfer when delivery at ship side 1. From the time of delivery of Seller.
If,
a) Vessel delays, fails to take the goods or
closed for cargoes earlier than time notified.
b) Any failure to give notice to Seller, Buyer
bears Risk from the agreed date or in
absence of agreed date, or from the date
selected by Buyer or from the end of any
agreed period for delivery
53 54
shipment)
CARRIAGE No Obligation to arrange contract of Arrange or contract the carriage at own cost
carriage, only to provide any information Nominating the carrier and advise Seller
and security issues at buyer risk and cost.
If agreed, Seller can make contract of
carriage at Buyer’s cost and risk
INSURANCE No Obligation, but need to provide No Obligation but should arrange
information
TRANSPORT Must provide Proof of delivery (seller’s Must accept Proof of Delivery of Seller
DOCUMENT account) or assist Buyer to obtain
Transport Documents at Buyer’s cost
and risk
CUSTOMS Carry out all export and related formality Carry out and pay for all clearance of transit
CLEARANCE in Seller Country and importation including duty and taxes
Packing /Marking Must arrange at own cost 54

No Obligation 55
shipment)
55 56
FOB - FREE ON BOARD (Insert named port of shipment)
Buyer Cost & Risk
S B
Bangkok Tokyo
Seller Cost & Risk Delivery

Seller delivers the goods on board
the vessel and the Risk is
S transferred after cargo on board
the vessel
FOB is not appropriate for

Buyer fixes Transportation & Insurance containerized Transport
56 57
Completion of Delivery:
• Seller ends up his obligation and risk when the goods is laden on
board the vessel nominated by Buyer at the port of shipment.
• Seller shall pay all expenses until the goods is laden on board.
• The Delivery shall be made at the agreed date, time and place
• Buyer fixes Transportation and Carrier, Vessel and Date.
57 58
Key point of Seller ‘s Obligation:
• Seller delivers and places the goods ON BOARD the vessel nominated
by Buyer at the named port of shipment. If no specific loading point
at the port or nominated vessel, then Seller may select that best suits
its purpose.
• Seller must make export clearance and pay all expenses incurred at
export country until cargoes are laden on board.
58 59
Key point of Seller ‘s Obligation: Delivery - 2 MUSTs
• Seller must deliver the goods by:

1. Place the goods on Board and
2.
a) On the Agreed Date or
b) At the time within the agreed period by the buyer or,
c) If no such time is notified, then at the end of the agreed period and
in the manner customary at the port
59 60
Key point of Buyer ‘s Obligation: Carriage and Risk
• Buyer must make contract of carriage at its own cost and port of
shipment, except if agreed, Seller makes contract of carriage.
• Buyer bears the risk after cargo laden on board including risks which
incurred of non-notices to Seller, if agreed.
60 61
Key point of Buyer ‘s Risk:

1. From On Board onwards - Normal case
2. But,
a) if Buyer fails to give notice of any sufficient notice of transport-

related security requirement, and if any selected delivery date within
the agreed period,
61 62
Key point of Buyer ‘s Risk:
1. From On Board onwards - Normal case
2. But if,
b) Vessel nominated by Buyer fails to arrive on time to enable Seller
performs delivery, or
c) Vessel fails to take the goods or closes for cargo earlier than the time
notified in the selected delivery date within the agreed period,
Then the risk will start from the agreed date or in the absence of an
agreed date, or from the date selected by Buyer or if no such date has
been notified, or from the end of any agreed period for delivery
62 63
If the parties have agreed that delivery should take place within a
period, the buyer has the option to choose the date of delivery within
that period.
The buyer must notify the seller thereof (name of the vessel, selected
time within the period agreed for delivery when the vessel will take the
goods, quay of taking delivery (loading point) within sufficient time as
to enable the seller to deliver the goods on board the ship.
Failing receipt of precise notice on the loading point and the selected
delivery time (‘pre advise’), the seller may use its discretion to select a
point in the named port of shipment that best suits its purpose, and
the delivery time within the agreed period.
63 64
DELIVERY Placing the goods on board the vessel on • Fix the port, date and time of delivery
the agreed date or at time within the and take delivery at the port cargo on
agreed period notified by Buyer, if no board the vessel
such time, then at the end of the agreed • Nominate Vessel
period and in manner customary at the
port
RISK Until the goods have been on board with From the on board time onwards and other
some exception** options in case of failure to provide notice*
CARRIAGE No Obligation, but to provide any Arrange or contract the carriage at own cost,
information and security issues at buyer but subject to the agreement with Seller
risk and cost allowing Seller to arrange or contract.
64 65

TRANSPORT To provide proof of delivery, or assist Buyer shall pay for Transport Document or
DOCUMENT Buyer to obtain Transport Document at obtain freely Proof of delivery from Seller
Buyer ‘s cost and risk
CUSTOMS Carry out and pay for all export Carry out and pay for all import clearance
CLEARANCE clearance, and relevant formalities. Assist Seller with export clearance at Seller’s
Assist Buyer with Import clearance, cost and risk
security information at Buyer’s cost and
risk
PACKING/MARKING Must arrange at own cost No Obligation
65 66

COST All costs until delivery, including Proof of All cost after delivery, including Transport
delivery, duties and taxes at origin, Buyer Document fee, duties and taxes at
assistance cost in obtaining documents destination, Seller assistance cost in
and information for export obtaining documents and information for
import.
**Any additional cost incurred because
1. Buyer fails to give notice
2. Vessel delays, fails to take the goods or
closes earlier than notified time.
66 67
CFR - COST AND FREIGHT (insert named port of
destination) Buyer Cost
Buyer Risk
Seller Cost Delivery Seller cost up to Port of

Seller Risk destination, but risk ends at
port of loading after cargo
S laden on board
Seller fixes Transport/Buyer fixes Insurance
67 68
destination)
• Port of Shipment and Port of Destination is important, and it is need
to be clearly state in sales contract.
• Risk transfers at Port of Shipment and Buyer may determine whether
the freight charge is reasonable from Port of Shipment to Port of
Destination.
• ***Sometime Port of Shipment can be Transshipment Port as shown
in Bill of Lading, therefore, it is necessary to specify where is the port
of shipment in their sales contract and Letter of Credit.***
• Unloading cost at Port of Destination is Seller’s cost if the contract of
carriage stipulate so.
68 69
destination)
Key point of Seller ‘s Obligation: Delivery and Risk
• Seller delivers the goods and places ON BOARD the vessel contracted
by Seller at the Port of Shipment or by procuring the goods so
delivered.
• Seller must deliver the goods on the agreed date or within the agreed
period and in the manner customary at Port of Shipment.
• Risk of Seller transfers when the goods placed on board.
69 70
destination)
Key point of Buyer ‘s Obligation: Delivery and Risk
• Buyer takes delivery at Port of Shipment and receive the goods from
the carrier at the named Port of Destination.
• Risk of Buyer is from the goods placing on board the vessel at Port of
Shipment.
• ***If Buyer fails to give Seller sufficient notice of time of shipping the
goods and/or the point of receiving the goods within the named
port of destination whenever Buyer entitles to determine so, then
Buyer bears risk from the agreed date or the end of the agreed period
for shipment.
70 71
destination)
DELIVERY Placing the goods on board the vessel on take delivery at the port of shipment after
the agreed date or at time within the cargo on board the vessel
agreed period in manner customary at
the port or procuring the goods so
delivered.
RISK Until the goods have been on board From the on board time onwards and in case
Buyer is entitled to determine shipping time,
but fails to notice Seller time of shipping,
Buyer bears the risk from agreed date or the
end of the agreed period for shipment.
CARRIAGE Contract a contract of carriage from No Obligation
agreed point of delivery at the place of
delivery to port of destination using
usual route and vessel type for type of
goods sold. Seller must comply transport-
security requirement. 71 72
destination)
INSURANCE No Obligation, but must provide No Obligation but should make
information for buyer to obtain insurance
TRANSPORT Must provide Transport Document at Must accept Transport Documents if it is in
DOCUMENT own cost and risk for Buyer to claim to conformity with the contract.
goods at destination and if agree, it
should enable Buyer to sell goods in
transit to subsequent Buyer. Full set
Document must be provide to Buyer
CUSTOMS Carry out and pay for all Export clearance Carry out and pay for all Import clearance
CLEARANCE Assist Buyer with Import clearance, Assist Seller with export clearance at Seller’s
security information at Buyer’s cost and cost and risk
risk
Packing /Marking Must arrange at own cost No Obligation
72 73
destination)
COST 1. All costs until goods laden on board 1. All costs other than payable by Seller
2. Cost of security issue and loading at 2. Cost of transit unless such costs are for
port of shipment. Seller account
3. Charge for unloading at destination 3. Unloading cost, lighterage, wharfage
4. Cost of Transit under contract of charge, unless such costs are for seller
carriage account.
5. Proof of Delivery/ Bill of lading fee 4. Seller Assistance cost in obtaining
6. Tax and Duties for Export at origin documents and information for import
7. Buyer Assistance cost in obtaining clearance
documents and information for 5. Taxes and Duties
export clearance 6. Failure of notice to Seller where the cost
incurred
73 74
CIF - COST, INSURANCE AND FREIGHT (insert named
port of destination) Delivery Buyer Cost
Buyer Risk cover by shipper insurance
Insurance cost
Seller Cost of Transport
Seller Risk
Seller’s cost up to Port of destination

Seller fixes Transport & Insurance plus insurance premium, but risk
ends at port of loading after cargo
Insurance shall cover from point of laden on board
delivery to port of destination
74 75
port of destination)
Key point of Seller ‘s Obligation: Delivery and Risk
• Seller delivers the goods and places ON BOARD the vessel contracted
by Seller at the Port of Shipment or by procuring the goods so
delivered.
• Seller must deliver the goods on the agreed date or within the agreed
period and in the manner customary at Port of Shipment.
• Risk of Seller transfers when the goods placed on board.
• Exactly: Delivery and Risk is SAME AS CFR
75 76
Key point of Seller ‘s Obligation: Insurance
Seller must obtain at its own cost the cargo insurance Clauses (C) of
Institute Cargo Clauses (LMA/IUA) or any similar clauses.
Seller can extend additional clauses upon Buyer’s request and cost.
Insurance shall be 110% of the price and currency in the sales contract.
Seller must provide evidence or insurance policy.
Insurance policy shall cover from point of delivery to at least the port of
destination.
76 77
Key point of Buyer ‘s Obligation: Delivery and Risk
Buyer takes delivery when the goods have been placed on Board the
vessel.
Buyer bears risks if fails to give notice whenever it is agreed that buyer
is entitled to determine the time of shipping the goods from such
agreed date or the end of the agreed period for shipment, providing
that goods is contract goods.
77 78
INVOICE Shall provide according to Sales Contract Pay the price provided in Sales Contract
DELIVERY Must place the goods on board the take delivery at the port of shipment after
vessel or by procuring the goods so cargo on board the vessel
delivered on the agreed date or at time
within the agreed period in manner
customary at the port of shipment
RISK Until the goods have been on board or by From the on board time onwards and in case
procuring the goods so delivered Buyer is entitled to fix the time of shipping
but fails to notice Seller time of shipping,
Buyer bears the risk from agreed date or
the end of the agreed period for shipment.
delivery to port of destination using
usual route and vessel type for type of
goods sold. Seller must comply transport-
security requirement. 78 79
INSURANCE Obtain Clauses (C) of Institute Cargo No Obligation but should provide necessary
Clauses or any similar clauses, enable information to Seller to procure any
Buyer or interests parties to claim, additional insurance if required.
extendable under buyer’s request and
cost to Institute war clauses and Institute
Strikes Clauses or similar clauses with
110 % of the price of the goods and shall
provide Buyer Insurance Policy including
inform for Buyer if Buyer wishes to make
additional policy itself.
TRANSPORT Must provide Transport Document at Must accept Transport Documents if it is in
DOCUMENT own cost and risk for Buyer to claim to conformity with the contract.
should enable Buyer to resell to
subsequent Buyer. Full set Document
must be provide to Buyer
79 80
CUSTOMS Carry out and pay for all Export clearance Carry out and pay for all IMPORT clearance
risk
80 81
risk
Cost 1. All Costs until delivered including 1. All costs other than payable by Seller
loading charge 2. Cost of transit unless such costs are for
2. Transport-related security issue Seller account
3. Transit cost and Unloading at 3. Unloading cost, lighterage, wharfage
destination under contract of carriage charge, unless such costs are for seller
4. Transport Document account.
5. Insurance premium 4. Seller Assistance cost in obtaining
6. Taxes and Duties at origin documents and information for import
documents and information for 5. Taxes and Duties at destination
export clearance 6. Failure of notice to Seller where any cost
81 incurred 82
CPT - Carriage paid to (insert named place of destination)
Delivery
Buyer Risk
Seller Cost
S
Carrier
Delivery Delivery
Seller Risk Buyer Cost
Seller Cost
Seller Truck TMO Seller’s cost is up to place of

destination but the risk ends at
the agreed point of delivery.
Seller fixes Transportation Buyer should buy Insurance
82 83
Key point of Seller ‘s Obligation: Contract of Carriage
• Seller must arrange contract of carriage from agreed point of delivery

to the named place of destination at Seller’s cost under usual term,
route in customary manner according to the type of goods sold.
• Seller must comply any transport-related security requirement.
83 84
• Seller must unload the goods at destination if those charges are for
Seller’s account under the contract of carriage.
• Seller must provide Negotiable Transport Document (Bill of Lading)
84 85

Buyer should carefully agree where is the Delivery Point.
Buyer shall whenever agreed, notice Seller the time for dispatching the
goods and/or point of receiving the goods at destination.
Buyer may pay Unloading charge if it is not seller’s account under

contract of carriage – Then how Buyer know about contract of
carriage……..
85 86

DELIVERY Hand over the goods to the Contracted take delivery at the delivery point and
Carrier at the Delivery Point or procuring receive the goods at the agreed point within
the goods so delivered. the place of destination
RISK Transfer the risk after hand over the Taking the risk once the goods is at disposal
goods to the carrier or Buyer fails to give of the carrier.
notice of the time for dispatching the
goods if agreed
delivery to the agreed point at the place
of destination using usual route and
vessel type for type of goods sold. Seller
must comply transport-security
requirement.
86 87

INSURANCE No Obligation, but to provide information No Obligation
to Buyer to obtain insurance at Buyer
cost
TRANSPORT If customary or at Buyer’s request, Seller Must accept Transport Documents if it is in
DOCUMENT must provide Transport Document at conformity with the contract.
own cost and risk for Buyer to claim to
should enable Buyer to resell during in
Document must be provide to Buyer in
Negotiable form.
87 88
risk
3. Transit cost and Unloading at 3. Unloading charge, unless such costs are
destination under contract of carriage for seller account.
4. Transport Document 4. Seller Assistance cost in obtaining
5. Taxes and Duties if any at origin documents and information for import
documents and information for 5. Taxes and Duties at destination
export clearance 6. Failure of notice to Seller time of
7. Unloading charge if under contract of dispatching goods or point of receiving
carriage goods when any additional cost incurred
88 89
CIP- Carriage and Insurance Paid to (insert named place
of destination)
Delivery
Buyer Risk
Seller Cost
S
Carrier
Insurance premium
Delivery Delivery
Seller Risk Buyer Cost
Seller Cost
Seller Truck TMO Seller’s cost is up to place of

destination but the risk ends at
Seller fixes Transportation Seller must buy Insurance Clause A
the agreed point of delivery.
89 90
of destination)
• Seller must arrange contract of carriage from agreed point of delivery

to the named place of destination at Seller account on usual term,
route in customary manner according to the type of goods sold.
• Seller must unload the goods at destination, only if those charges are
for Seller’s account under the contract of carriage.
• Seller must provide Negotiable Transport Document
90 91
of destination)
Key point of Seller ‘s Obligation: Insurance
• Seller must arrange Insurance against Buyer’s risk from the point of
delivery to at least the point of destination.
• Seller must obtain extensive insurance cover complying with Institute
Cargo Clauses (A) or similar clauses. But it is open to agree on a
lower level clauses.
91 92
of destination)
. Buyer should carefully agree where is the Delivery Point.
Buyer shall whenever agreed, notice Seller the time for dispatching the
goods and/or point of receiving the goods at destination.
Buyer may pay Unloading charge if it is not seller’s account under

contract of carriage
92 93
of destination)
DELIVERY Hand over the goods to the Contracted take delivery at the delivery point and
Carrier at the Delivery Point or procuring receive the goods at the agreed point within
the goods so delivered. the place of destination
RISK Transfer the risk after hand over the Taking the risk once the goods is at disposal
goods to the carrier or Buyer fails to give of the carrier.
notice of the time for dispatching the
goods if agreed
delivery to the agreed point at the place
of destination using usual route and
vessel type for type of goods sold. Seller
must comply transport-security
requirement.
93 94
of destination)
INSURANCE Must provide cargo insurance by Clauses No Obligation but to provide any information
(A) of Institute Cargo Clauses (LMA/IUA) to Seller to procure any additional insurance
or similar clauses at Seller’s cost. required by Buyer
Additional clauses such as Institute Ware
Clauses and/or Institute Strikes Clauses is
at Buyer Cost, unless such cover is
already included in the cargo insurance
done by Seller.
TRANSPORT If customary or at Buyer’s request, Seller Must accept Transport Documents if it is in
DOCUMENT must provide Transport Document at conformity with the contract.
own cost and risk for Buyer to claim to
should enable Buyer to resell during in
Document must be provide to Buyer in
Negotiable form.
94 95
of destination)
risk
3. Transit cost and Unloading at 3. Unloading charge, unless such costs are
destination under contract of carriage for seller account.
4. Transport Document 4. Seller Assistance cost in obtaining
5. Insurance premium documents and information for import
6. Taxes and Duties at origin clearance
7. Buyer Assistance cost in obtaining 5. Taxes and Duties at destination
documents and information for 6. Failure of notice to Seller time of
export clearance dispatching goods or point of receiving
8. Unloading charge if under contract of goods when any additional cost incurred
carriage 95 96
DPU – Delivered at Place Unloaded (insert named place
Buyer Cost & risk
of destination)
Delivery Delivery
Seller Cost and Risk
Seller fixes Transportation Obligation released when Seller delivers by

Seller should buy Insurance unloading at the named place of destination
96 97
of destination)
• Seller must arrange contract of carriage from his premise to the

named place of destination by specify the destination place or point
as clearly as possible with the Buyer at Seller’s cost. Any additional
cost may incur to Seller if Seller fails to deliver the goods at said point.
• Seller must unload the goods at the place.
97 98
of destination)
Key point of Buyer ‘s Obligation: Place of Delivery
• Buyer must advise Seller the destination place or point as clearly as

possible.
• Buyer has obligation to perform import clearance or post-delivery to the
third country at its own account, if any.
• Buyer shall be responsible for any loss and damage if buyer fails to
organize import clearance when the goods are at the port or inland
terminal for further delivery.
• If there is no agreed specific point to deliver, Seller may select best suits
point at the named place.
98 99
of destination)
DELIVERY Place the goods at the disposal of Buyer take delivery at the delivery point within the
by unloading from the means of place of destination
transport at the named place/point, or
by procuring the goods so delivered and
must delivery on the agreed date or
within the agreed period.
RISK Transfer the risk after unloading at the Taking the risk once the goods are unloaded
agreed place or point at destination at the named place. Fails to make import
clearance, or provide notice of time and
place of delivery at destination
CARRIAGE Contract a contract of carriage from his No Obligation
premise to the agreed point at the place
of destination. If no mentioned, Seller
may select delivery point. Seller must
comply transport-security requirement.
99 100
of destination)
INSURANCE No Obligation (but should arrange) No Obligation but to provide any information
to Seller to procure any insurance required
by Seller
TRANSPORT Must provide transport document Must accept Transport Documents if it is in
DOCUMENT enabling the buyer to take over the conformity with the contract.
goods at its cost.
100 101
of destination)
risk
unloading charge 2. Seller Assistance cost in obtaining
2. Transport Document documents and information for import
3. Taxes and Duties at origin clearance
4. Buyer Assistance cost in obtaining 3. Taxes and Duties at destination
documents and information for 4. Failure to fulfil its obligation, such as
export clearance import clearance, point of taking delivery
where any additional cost may incur
101 102
DAP – Delivered at Place (insert named place of
destination)
Buyer Cost
Named place
Delivery Delivery
Seller Cost and Risk
Seller cost and risk is ended at nominated

destination including everything excepts Duty
and Taxes
Seller fixes Transport
Seller should buy Insurance
102 103
destination)

as clearly as possible with the Buyer at Seller’s account. Any
additional cost may incur to Seller if Seller fails to deliver the goods at
said point.
• Seller has no obligation to unload the goods at the place.
103 104
destination)

possible.
• Buyer has obligation to perform import clearance or post-delivery to the
third country at its own account
• Buyer shall be responsible for any loss and damage if buyer fails to
organize import clearance when the goods are at the port or inland
terminal for further delivery.
• If there is no agreed specific point to deliver, Seller may select best suits
point at the named place.
104 105
destination)
upon the arrival of the means of place of destination
transport at the named place/point
ready for unloading , or by procuring the
goods so delivered and must delivery on
the agreed date or within the agreed
period.
RISK Transfer the risk after the goods arrive at Taking the risk once the goods are placed at
the agreed place or point at destination, the named place. Fails to make import
without unloading clearance, or provide notice of time and
place of delivery at destination
105 106
destination)
INSURANCE No Obligation No Obligation but to provide any information
to Seller to procure any additional insurance
required by Seller
TRANSPORT Must provide transport document Must accept Transport Documents if it is in
DOCUMENT enabling Buyer to take over the goods conformity with the contract.
106 107
destination)
risk
Cost 1. All Costs until delivery. 1. All costs other than payable by Seller
2. Transport Document 2. Unloading charge, unless such costs are
3. Taxes and Duties at origin for seller account.
4. Buyer Assistance cost in obtaining 3. Seller Assistance cost in obtaining
documents and information for documents and information for import
export clearance clearance
5. Unloading charge if under contract of 4. Taxes and Duties at destination
carriage 5. Failure to provide notice to Seller, such
6. Insurance (no obligation, but must) as import clearance, point of taking
delivery where any additional cost
incurred
107 108
DDP– Delivered Duty Paid (insert named place of
destination)
Buyer Cost
Seller Cost and Risk Delivery

Clearance and pay Taxes
Seller fixes Transportation Seller cost and risk is ended at nominated

Seller should buy Insurance destination including everything concerned with
transportation, also Duty and Taxes
108 109
destination)

as clearly as possible with the Buyer at Seller’s cost. Any additional
cost may incur to Seller if Seller fails to deliver the goods at said point.
• Seller has no obligation to unload the goods at the place.
109 110
destination)

possible.
• Buyer has no obligation to perform import clearance, but Buyer must
assist Seller in obtaining related documents or information related to
Export/Import clearance required by Export or Import country at
Seller’s account
• If there is no agreed specific point to deliver, Seller may select best
suits point at the named place.
110 111
destination)
upon the arrival of the means of place of destination
transport at the named place/point
ready for unloading, or by procuring the
goods so delivered and must delivery on
the agreed date or within the agreed
period.
RISK Transfer the risk after the goods arrive at Taking the risk once the goods are placed at
the agreed place or point at destination, the named place. If fails to assist Seller
without unloading obtaining necessary document for import or
fails to give notice of time and place of
destination, Buyer takes risk.
111 112
destination)
INSURANCE No Obligation No Obligation but to provide any information
to Seller to procure any insurance required
by Seller
TRANSPORT Seller must provide Transport Document Must accept Transport Documents if it is in
DOCUMENT at own cost and risk conformity with the contract.
112 113
destination)
CUSTOMS Carry out and pay for all Only Assist Seller with export/import
CLEARANCE Export/transit/Import clearance, licence, clearance in order to obtain any
security clearance, pre-shipment inspection, documents and or information for such
and any other officials documents purpose at Seller’s cost and risk
Cost 1. All Costs until delivered including loading 1. All costs other than payable by Seller
charge 2. Unloading charge, unless such costs
2. Transport Document are for seller account.
3. Insurance premium (no obligation) 3. Any additional cost incurred by Seller
4. Taxes and Duties at origin and if Buyer fails to fulfil its obligation in
destination including import clearance assist Seller obtaining document or
5. Buyer Assistance cost in obtaining information for export/import
documents and information for export clearance and point of taking delivery
clearance & time if agreed.
6. Unloading charge if under contract of
carriage
113 114
TIPs in selecting INCOTERM
• EXW – Seller wishes not to bear any obligation, risk and any cost.
• Caution of Buyer: Buyer must ensure to have a reliable MTO at right cost to
perform transportation.
• If Agreed, Seller may load the goods for Buyer, while loading risk must be
clearly agree on whose responsibility - if so, then instead of using EXW,
FCA is better.
• FCA – It is much better to use FCA than FOB if Seller send the goods to ICD,
Port Terminal or nominated place. But if Buyer requires B/L, then Seller has
to obtain B/L within L/C latest shipment date.
• In this case, Seller needs to spare some time after delivery for B/L.
• Buyer should provide clearly the point of delivery nominated by him
114 115
• FAS is suitable for non containerized shipments and mostly bases on
Voyage Charter or COA basis.
• It is recommended that Buyer must have a very good understanding
of required handling methods and processes at the origin or have a
strong agent who could assist to perform such requirement at the
port of loading, under the time of LIFO or Full Liner Term.
• Buyer needs to ensure when entering into the contract of carriage
that where and when the risk and cost of the seller ends.
• Seller have to ensure that a proof of such delivery is secured in form a
shipping order or delivery note/dock receipt signed by Port or
terminal or ship’s agent when delivery is made.
115 116
• FAS cont:
• Bill of Lading is Buyer’s account.
• Buyer may have to hire surveyor to inspect the goods before loading
on the board for the quality and weight of the goods.
• After Seller places the goods alongside the vessel nominated by Buyer
on Agreed date, or vessel delays, or vessel fails to take the goods or
closes earlier, then Buyer will bear all risk. Buyer should aware of this.
What if the Seller place the goods on the Agreed Date, but Vessel does
not arrive.?
116 117
• FOB: Seller bears less risk on fluctuation of Freight Charge and Currency
• FOB can be used for the bulk shipment which may extend to FOB Stowed
and Trim. Seller then, must know exactly requirements linked to this issue,
such as stowage and trim. (FIOST in charter party) including Free time of
loading in order to avoid argument of demurrage.
• Buyer should provide Agreed Period but should not nominate Vessel name
as the risk will transfer to Buyer if the such Vessel does not arrive in time
for the cargoes to be loaded in case of Containerized transport. But in case
of Bulk cargoes, Buyer must provide the nominated vessel’s name.
• FOB, CFR, CIF is not suitable for Seller if he send the goods to ICD, better
use FCA up to Terminal in case of container
117 transport. 118
• FOB: Mostly Buyer will nominate Carrier rather than Vessel name to
Seller in Containerized Transport and does not provide Agreed date of
the shipment. Seller therefore, has option to select the suitable
vessel for his shipment to solve the problem of Agreed Date.
• If Buyer nominates the vessel and if the nominated vessel rolls over
the goods or the container or closing for the cargoes earlier at the
time when the goods is at the port of shipment, then the risk and any
additional cost is belonging to Buyer.
118 119
• CFR/CIF risk of Seller ends at the goods laden on board at the port of
shipment, not port of destination.
• CFR/CIF term is used for only Water Transport
• CFR/CIF can be used both Containerized or non Containerized
shipments.
• In case of Tramp, Seller must understand free time allowed for
loading the cargoes, otherwise demurrage may incur which need to
be agreed who will bear the cost, if Seller is not Charterer.
• Buyer should realize that compulsory Insurance is Institute Cargo
Clauses C not A, but Buyer can request Seller to extend clauses.
119 120
• CPT/CIP can be used for Unimodal & Multimodal Transport where
Seller bears no risk after delivering to the Carrier.
• If you wish to pay all transportation charge to destination under
minimum risk, CPT/CIP shall be used.
• It is important for Buyer to understand where and when the Seller
hand over the goods to the carrier in order to obtain insurance for
CPT term.
• CIP is better than CPT for Buyer because Seller will arrange insurance
according to the time of hand over the goods to carrier. This reduces
Buyer’s risk in term of the time to arrange the insurance.
120 121
• DPU is similar as CFR in term of unloading cost at terminal if DPU is
used up to terminal, but Seller Obligation is different.
• DPU can be used similar like “ CFR Airport at destination” as Airline
will unload the goods into the Terminal where is the place of delivery.
• Note: No CFR AIRPORT in this INCOTERM version 2020
• DAP is more suitable to use outside the terminal since Seller has no
obligation to unload the goods at the place and point of delivery.
• DDP is most risk and cost to Seller and Seller must ensure that Service
Provider is very capable to arrange Import Customs clearance
correctly. If missed declaration of H.S. Code, it may create Penalty
from Customs at Seller’s cost. Otherwise higher tariff shall be
selected.
121 122
• FAS, FOB, CFR, CIF is the group term that uses for Inland waterway
and Ocean Transport
• The rest of the terms can be used for Unimodal or Multimodal
transport.
122 123
• DIFFERENT OF INCOTERM - Seller Obligation
• EXW – No loading onto truck FCA – Loading onto truck

• DPU - Unload at destination DAP/DDP – No Unloading at destination
• DAP - No clearance and taxes DDP - Pay for clearance and duty and taxes
123 124
• DIFFERENT OF INCOTERM - Seller and Buyer Obligation: Documents
• EXW – Buyer provides Evidence of Receipt such as FCR

• FCA – Seller provides Proof of Delivery such as Delivery Note
• CFR/CIF/CPT/CIP – If Seller provide Negotiable B/L, must be full set
• DAP/DPU/DDP - Seller must provide Transport Document
• FAS/FOB – Seller provides Proof of Delivery, but if it is Transport Document,
Seller must assist Buyer to obtain at Buyer’s Cost and Risk
124 125

Incoterm 2020 MMMC

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Incoterm 2020 MMMC

Uploaded by

Copyright:

Available Formats

DAW OHN MAR MAW

• To define obligation of seller and buyer

• To be able to suggest the appropriate term

• Delivery expenses and time

dealing with delivery conditions

between buyer & seller;

ONLY SEA TRANSPORTATION:

FAS, FOB, C&F, CIF, Ex Ship, Ex Quay

Third Version 1967 Adding two new terms

Fourth Version 1967 Adding FOB Airport

FRC (Free Carrier….Named at Point)

Sixth Version in 1990 Better shape of revision

Deleted FOR, FOT, FOB Airport as FCA can be appropriate used .

Eighth Version Year 2010

RULES FOR SEA AND INLAND WATERWAY TRANSPORT

1. FAS FREE ALONGSIDE SHIP

2. FOB FREE ON BOARD

3. CFR COST AND FREIGHT

4. CIF COST INSURANCE AND FREIGHT

RULES FOR ANY MODE OR MODES OF TRANSPORT

2. FCA FREE CARRIER

3. CPT CARRIAGE PAID TO

4. CIP CARRIAGE AND INSURANCE PAID TO

5. DAT DELIVERED AT TERMINAL

6. DAP DELIVERED AT PLACE

7. DDP DELIVERED DUTY PAID

FCA FAS, FOB

CPT, CIP CFR, CIF

DAT, DAP, DDP

Export- Unloading of Loading Carriage to Unloading Loading on Import

RULES FOR SEA AND INLAND WATERWAY TRANSPORT

1. FAS FREE ALONGSIDE SHIP

2. FOB FREE ON BOARD

3. CFR COST AND FREIGHT

4. CIF COST INSURANCE AND FREIGHT

2. FCA FREE CARRIER

3. CPT CARRIAGE PAID TO

4. CIP CARRIAGE AND INSURANCE PAID TO

5. DPU DELIVERED AT PLACE UNLOADED

6. DAP DELIVERED AT PLACE

7. DDP DELIVERED DUTY PAID

Export- Unloading of Loading Carriage to Unloading Loading on Import

FCA FAS, FOB

CPT, CIP CFR, CIF

DPU, DAP, DDP

It set out the Tasks or Obligations (Delivery), Risk, and allocation of

INCOTERM can be used as Trade Term both domestic and international

• Delivery Point & Place of Destination

MTO services nominated by Buyer

1. MTO at origin pick up and book carrier, ship the goods

• Seller has no obligation to load the goods on any

• Seller must assist buyer in obtaining any documents

• Delivery Point: can be at Factory or any agreed places. Buyer

INSURANCE No Obligation No Obligation but should make

OBLIGATION SELLER BUYER

Packing Must arrange at own cost No Obligation

Buyer Cost and Risk

Buyer Cost and Risk

Buyer nominates the named place of delivery

SECOND SCENARIO AT Other Place nominated by

• FCA term can be concluded by naming only the place of delivery,

• SCOND SCENARIO AT BUYER NOMINATED PREMISE:

Seller Cost & Risk Buyer Cost & Risk