Incoterms 2019-11-17T14:14:27+00:00


The International Commercial Terms and Incoterms Rules are published by the International Chamber of Commerce (ICC) for the first time in 1936 and have since been used in international commercial operations. Under the rules of Incoterms, trading terms are provided that ensure safe transportation of goods.

The rules of Incoterms are marked with a series of three letters and precisely identifies tasks, expenses and risks associated with transportation and the supply of goods. Inocterms rules are used in periodically renewed terms in international traffic.

Rules for any type of transportation:

7 conditions for shipping by Incorterms 2010:

EXW – Ex Works (Name of the delivery place) – this term imposes maximum responsibility for the buyer and the minimum for the seller. Ex Works – This term is often used when determining the starting value of goods – while quoting additional expenses. EXW means that the seller is ready to collect the goods in its territory for some agreed period. The buyer will pay for all transportation costs and also take risks for transportation to the final item of goods. The seller does not load the goods and does not export it. If the seller loads it, it is reflected in the price and the risk is paid to the buyer. If the parties wish that the seller is

responsible for the loading of goods, as well as all the risks and expenses of such a load, it should be clearly defined in the purchase-sale agreement.

FCA -Free Carrier (Name of the delivery place) The seller’s obligation shall be deemed to be delivered on the delivery of the goods to the buyer if it transmits the goods prepared for export to the address indicated by the buyer chosen by the buyer.

CPT -Carriage paid to – Shipping is reimbursed … Up to the destination (name of the destination place) the seller pays for the shipment. The risk goes to the buyer as soon as the goods are delivered to the first carrier.

CIP– Carriage and Insurance Paid to – Shipping and insurance will be paid up to … Container shipments, CIF’s multimodal equivalent. The seller pays the carriage and insurance fees to the destination, but the risk goes when the goods are delivered to the first carrier.

DAT-Delivered at Terminal – Shipping terminal (name of port terminal or destination place) is paid by the vendor to the terminal, except for the expenses incurred on imports and undertakes all risks before the cargo terminals.

DAP– Delivered at Place – Shipping place (name of the destination).The seller pays the shipping fee to the place indicated, except the fees associated with the import settlement, taking responsibility at all risk to the buyer without charge.

DDP– Delivered Duty Paid – Delivery to customs clearance (name of the destination) The seller’s obligation to supply the burden shall be deemed to be performed when it comes to the buyer with the goods in the place of destination-importing country. This term imposes maximum responsibility for the buyer and the minimum to the  seller.

Rules for Maritime Transport:

The four conditions of marine transfer defined by Incorterms 2010:

FAS – Free Alongside Ship (Name of the carrier port) The seller is obliged to deliver the cargo to the specified port and deploy it on the ship. The seller is obliged to prepare the burden for export. It is convenient to use only in sea transport, but not in multimodal marine transport containers (see Incoterm 2010, ICC Edition 715). This term is mainly used for heavy cargo.

FOB– Free on board (Name of loading port). The seller’s obligation to sell the goods to the buyer is deemed to be executed when the goods are crossed in the port of the ship’s cargo. At the moment, the risk of accidental death or loss of the cargo shall bear the buyer. In addition, FOB implies preparation of goods by the seller for export.

CFR – Cost and Freight (Name of the destination port) is the seller’s duty to pay the cost of the goods to be paid in the destination port and the cost of the borrowing, but it does not bear the risk of accidental destruction of the cargo. In addition, the seller is not bound to pay the costs incurred by the events arising after placing the cargo on the deck. The seller is also responsible for the preparation of the export of goods.

CIF – Cost, Insurance and Freight (Name of destination port). In the case of this term, the seller shall bear the same liabilities in case of CFR term plus marine insurance in case of accidental death or destruction of goods by the buyer during the transportation of goods. The seller is obliged to pay the insurance premium. In this case, it provides to be insured by the minimum coverage.