Understanding Incoterms

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Nga Pham
risk transfer point for FCA?

For the FCA Incoterm (Free Carrier), the risk transfer point occurs when the goods
have been delivered by the seller to the carrier or another person nominated by the
buyer at the named place of delivery, which is typically a place of business or a
warehouse.

At this point, the risk of loss or damage to the goods is transferred from the seller
to the buyer, and the buyer assumes responsibility for all further costs and risks
associated with the shipment. This includes any transportation costs, insurance,
and customs formalities required to get the goods to their final destination.

It is important to note that under FCA, the named place of delivery can be located
either in the seller's country or in another country, depending on the agreement
between the parties. The buyer should also ensure that the carrier or the
nominated person is reliable and properly equipped to handle the shipment.

Nga Pham
we are an importer in Vietnam, we signed contract with Hermes and patek philippe
to import goods under FCA, EXW incoterm. which is the point of risk transfer from
saler to buyer that we can used to record inventory?

If you have signed contracts with Hermes and Patek Philippe to import goods
under FCA or EXW Incoterms, the risk transfer point will depend on the specific
terms agreed upon between you and the sellers.

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Under FCA Incoterm, the risk transfer point occurs when the goods have been
delivered to the carrier or another person nominated by the buyer at the named
place of delivery. If the named place of delivery is in the seller's country, the risk
transfer point will occur when the goods have been loaded on the carrier's vehicle
or when the carrier has taken possession of the goods. If the named place of
delivery is in another country, the risk transfer point will occur when the goods
have been cleared for export.

Under EXW Incoterm, the risk transfer point occurs when the goods are made
available at the seller's premises or another named place of pickup. In this case, the
buyer is responsible for arranging for the transportation of the goods from the
seller's premises and assuming all the risks associated with transportation.

Therefore, in order to determine the appropriate risk transfer point for your
imports, you should review your contracts with Hermes and Patek Philippe
carefully to determine the named place of delivery or pickup, and confirm the point
at which the risk transfers from the seller to the buyer. This will allow you to
properly record the inventory and assume the risks associated with transportation
and storage of the goods.

Nga Pham
it is difficult for us to determine the named place of delivery or pickup, and confirm
the point at which the risk transfers from the seller to the buyer because shipper
has not pick up all items at once, they collected items many times until get the
target volume then deliver to us in air way. how to determine the time to recorded
inventory?

If it is difficult to determine the specific named place of delivery or pickup and the
point at which the risk transfers from the seller to the buyer due to multiple
shipments, you may need to use other means to establish the time at which to
record inventory and assume risk.

One approach you could consider is to establish a cut-off date or threshold for the
shipments that you have received from the sellers. For example, you may choose to
record inventory and assume risk for all shipments received up to a certain date or
when a specific quantity of goods has been received.

Another approach is to consult with the sellers and agree on a specific point at
which the risk transfers to you. This could be based on the point at which the goods
are loaded onto the aircraft or when the goods are cleared for export, for example.

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 Ultimately, the key is to establish clear communication with the sellers and work
together to determine the appropriate time to record inventory and assume risk.
This will help ensure that both parties have a clear understanding of their
obligations and responsibilities under the contract.

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