Jump Main Menu. Go directly to the main content

Incoterms

Start of main content

The Incoterms are terms, each made up of three letters, reflecting the voluntary acceptance rules by the parties in an international freight purchase agreement regarding the delivery terms and conditions of the freight.123. They are used to clarify the costs of international business transactions, defining responsibilities between buyer and seller and reflect current practice in international freight transport..

Changes to Incoterms 2020

The changes to Incoterms 2020 compared to Incoterms 2010 are:

  • Incoterm DAT (Delivered At Terminal) is replaced by DPU (Delivered at Place Unloaded). The most important aspect of this modification is the change of name, as the responsibilities and obligations are the same, but the new DPU term allows the delivery to be established anywhere, and not specifically at the terminal, even though that can be agreed in the contract if the parties so desire.
  • New terms and conditions are set when taking out insurance for CIF and CIP Incoterms.
  • In the FCA Incoterm is supplied using maritime transport, the purchaser can now ask the shipping company or its agent to accept the BL (Bill of Lading) with the "on board" comment for the seller.

Incoterms Clasification

“E” Departure “F” Main Carriage Unpaid “C” Main Carriage Paid “D” Arrival
Servicio EXW
Ex-Works
(Place)
FCA
Free Carrier
(Place)
FAS
Free Alongside Ship
(Port)
FOB
Free On Board
(Port)
CFR
Cost & Freight
(Port)
CIF
Cost Insurance & Freig
CPT
Carriage Paid To
(Place)
CIP
Carriage & Insurance Paid To
(Place)
DPU
Delivered at Place Unloaded
(Place)
DAP
Delivered at Place
(Place)
DDP
Delivered Duty Paid
(Place)
Obligation and Charges
Warehousing Services Seller Seller Seller Seller Seller Seller Seller Seller Seller Seller Seller
Export Packing Seller Seller Seller Seller Seller Seller Seller Seller Seller Seller Seller
Loading at Point of Origin Buyer Seller Seller Seller Seller Seller Seller Seller Seller Seller Seller
Inland Freight Buyer Seller Seller Seller Seller Seller Seller Seller Seller Seller Seller
Port Origin Charges Buyer Seller Seller Seller Seller Seller Seller Seller Seller Seller Seller
Export Clearance Buyer Seller Seller Seller Seller Seller Seller Seller Seller Seller Seller
Ocean/Air Freight Buyer Buyer Buyer Buyer Seller Seller Seller Seller Seller Seller Seller
Port Charges Destination Buyer Buyer Buyer Buyer Buyer Buyer Buyer Buyer Seller Seller Seller
Customs Clearance Buyer Buyer Buyer Buyer Buyer Buyer Buyer Buyer Buyer Buyer Seller
Custom Duties Buyer Buyer Buyer Buyer Buyer Buyer Buyer Buyer Buyer Buyer Seller
Unloading Charges Buyer Buyer Buyer Buyer Buyer Buyer Buyer Buyer Seller Buyer Buyer
Delivery Charges to Final Destinatio Buyer Buyer Buyer Buyer Buyer Buyer Buyer Buyer Buyer/Seller Buyer/Seller Seller
Recommended Means of Transport
Mode Term
Any Mode of Transport including Multimodal EXW Ex Works (...Named Place of Delivery)
FCA Free Carrier (...Named Place of Delivery)
CPT Carriage Paid To (...Named Place of Destination)
CIP Carriage & Insurance Paid To (...Named Place of Destination)
DPU Delivered at Place Unloaded (...Named Place)
DAP Delivered at Place (...Named Place of Destination)
DDP Delivered Duty Paid (...Named Place of Destination)
Ocean FAS Free Alongside Ship (...Named Port of Shipment)
FOB Free Alongside Ship (...Named Port of Shipment)
CFR Cost and Freight (...Named Port of Destination)
CIF Cost, Insurance and Freight (...Named Port of Destination)

Incoterms Rules and Standards 

  • Incoterms only relate to trade terms in the contract of sale between the buyer and seller and do not deal with the contract for carriage, or convey title.
  • The roles and responsibilities listed on the front of this document can be altered / changed as long as there is an agreement between the buyer and seller.
  • Incoterms do not identify where the transfer of ownership or title occur. A separate statement regarding ownership / transfer of title should be included on the purchase order, contract, quote, proforma invoice and or commercial invoice.
  • Incoterms are not all inclusive and cannot address issues such as customary operations of carriers, ports, trade government regulations etc.
  • Incoterms are written to reflect rather than dictate trade practices.
  • Only two incoterms express when insurance is to be bought and issued – CIP and CIF

End of main content