INCOTERMS 2020

International Commercial Terms that define responsibilities between buyers and sellers

Understanding INCOTERMS

INCOTERMS are internationally recognized terms that clarify the tasks, costs, and risks for buyers and sellers in international transactions.

                            Key Concepts
                             Define responsibility for shipment costs
 Determine transfer of risk location
 Specify export/import clearance duties
 Identify responsibility for insurance

                        

Incoterm 2020	Loading on truck	Export Customs	Carriage to export port	Unloading in export port	Loading charges	Carriage to import port	Unloading charges	Loading on truck in import	Carriage to destination	Insurance	Import Customs	Import Taxes
EXW	Buyer	Buyer	Buyer	Buyer	Buyer	Buyer	Buyer	Buyer	Buyer	Buyer	Buyer	Buyer
FCA	Seller	Seller	Buyer	Buyer	Buyer	Buyer	Buyer	Buyer	Buyer	Buyer	Buyer	Buyer
FAS	Seller	Seller	Seller	Seller	Buyer	Buyer	Buyer	Buyer	Buyer	Buyer	Buyer	Buyer
FOB	Seller	Seller	Seller	Seller	Seller	Buyer	Buyer	Buyer	Buyer	Buyer	Buyer	Buyer
CFR	Seller	Seller	Seller	Seller	Seller	Seller	Buyer	Buyer	Buyer	Buyer	Buyer	Buyer
CIF	Seller	Seller	Seller	Seller	Seller	Seller	Buyer	Buyer	Buyer	Seller	Buyer	Buyer
DAT	Seller	Seller	Seller	Seller	Seller	Seller	Seller	Buyer	Buyer	Buyer	Buyer	Buyer
CPT	Seller	Seller	Seller	Seller	Seller	Seller	Seller	Seller	Seller	Buyer	Buyer	Buyer
DAP	Seller	Seller	Seller	Seller	Seller	Seller	Seller	Seller	Seller	Seller	Buyer	Buyer
CIP	Seller	Seller	Seller	Seller	Seller	Seller	Seller	Seller	Seller	Seller	Buyer	Buyer
DDP	Seller	Seller	Seller	Seller	Seller	Seller	Seller	Seller	Seller	Seller	Seller	Seller

Group E - Departure

Seller makes goods available at their premises

EXW - Ex Works

Seller makes goods available at their premises. Buyer responsible for all transportation costs and risks.

Risk Transfer: When goods are available at seller's location

Best For: All transport modes, when buyer handles export

Group F - Main Carriage Unpaid

Seller delivers goods to carrier arranged by buyer

FCA, FAS, FOB

Seller delivers goods to carrier or named place. Buyer arranges main carriage.

Risk Transfer: When goods delivered to carrier

Best For: Containerized or non-containerized goods

Group C - Main Carriage Paid

Seller arranges main carriage to destination

CFR, CIF, CPT, CIP

Seller arranges and pays for main carriage. Risk transfers before main carriage.

Risk Transfer: When goods delivered to first carrier

Best For: Maritime and all transport modes

Key Changes in INCOTERMS 2020

FCA with Bill of Lading

New option allowing seller to instruct carrier to issue onboard bill of lading after loading.

CIP Insurance Changes

CIP now requires seller to obtain higher insurance coverage (Institute Cargo Clauses A).

DAT Renamed to DPU

DAT (Delivered at Terminal) is now DPU (Delivered at Place Unloaded).

Security Requirements

Clearer allocation of responsibilities for security-related obligations.