INCOTERMS are devised and published by the International Chamber of Commerce (ICC)

Date posted: 04.11.2015

INCOTERMS are devised and published by the International Chamber of Commerce (ICC) .

Group E – Departure

Ex Works (EXW) – the seller has the goods ready for collection at their premises (factory, warehouse, plant) on the date agreed upon. The buyer pays all transportation costs and also bears the risks for bringing the goods to their final destination.

Group F – Main Carriage Unpaid

Free Carrier (FCA) – this can be used for all modes of transportation including multi modal transport. The seller delivers the goods into the custody of the first carrier, and this is where risk passes from seller to buyer. The buyer pays for the transportation.

Free Alongside Ship (FAS) – the seller pays for transportation of the goods to the port of shipment. The buyer pays loading costs, freight, insurance, unloading costs and transportation from the port of destination to his factory. The passing of risk occurs when the goods have been delivered to the quay at the port of shipment.

Free On Board (FOB) - the seller pays for transportation of the goods to the port of shipment, plus loading costs. The buyer pays freight, insurance, unloading costs and transportation from the port of destination to his factory. The passing of risks occurs when the goods pass the ship’s rail at the port of shipment. Internationally the term specifies the port of origin, e.g. “FOB New York” or “FOB Vancouver”.

Group C – Main Carriage Paid

Cost and Freight (CFR) - the seller pays for transportation to the port of shipment, loading and freight. The buyer pays for the insurance and transportation of the goods from the port of destination to his factory. The passing of risk occurs when the goods pass the ship’s rail at the port of shipment.

Cost, Insurance and Freight (CIF) – the selling price includes the cost of the goods, the freight or transport costs and also the cost of marine insurance. This is common in sales contracts that may be encountered in international trading when ocean transport is used.

Carriage Paid To (CPT) - can be used for all modes of transport including multimodal transport. The seller pays for the freight to the named point of destination. The buyer pays for the insurance. The passing of risk occurs when the goods have been delivered into the custody of the first carrier.

Carriage and Insurance Paid To (CIP) - can be used for all modes of transport including multimodal transport. The passing of risk occurs when the goods have been delivered into the custody of the carrier. It is the same as CPT except that the seller also pays for the insurance.

Group D – Arrival

Delivered at Frontier (DAF) - can be used when the goods are transported by rail and road. The seller pays for transportation to the named place of delivery at the frontier. The buyer arranges for customs clearance and pays for transportation from the frontier to his factory. The passing of risk occurs at the frontier.

Delivered Ex Ship (DES) - the seller has to pay for the same as in CIF, but the passing of risk does not occur until the ship has arrived at the port of destination, but before the goods have been unloaded.

Delivered Ex Quay (DEQ) - means the same as DES, but the passing of risk does not occur until the goods have been unloaded at the port of destination.

Delivered Duty Unpaid (DDU) - the seller pays for all transportation costs and bears all risk until the goods have been delivered, but does not pay for the duty.

Delivered Duty Paid (DDP) - the seller pays for all transportation costs and bears all risk until the goods have been delivered and pays the duty.

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