Incoterms 2020 Explained
Incoterms (International Commercial Terms) are standard rules published by the International Chamber of Commerce that define who is responsible for the costs, risks, and tasks at each stage of an international shipment. Choosing the right Incoterm makes clear where the seller's responsibility ends and the buyer's begins.
Ex Works
Any modeThe seller makes the goods available at their own premises. The buyer takes on all costs and risk from that point, including loading and export clearance.
Free Carrier
Any modeThe seller delivers the goods, cleared for export, to a carrier chosen by the buyer at a named place.
Free Alongside Ship
Sea & inland waterwayThe seller delivers the goods alongside the vessel at the named port. Risk passes to the buyer from there. Sea and inland waterway only.
Free On Board
Sea & inland waterwayThe seller loads the goods onto the vessel. Risk passes to the buyer once the goods are on board. Sea and inland waterway only.
Cost and Freight
Sea onlyThe seller pays the cost and freight to the destination port, but risk passes to the buyer once the goods are on board. Sea only.
Cost, Insurance and Freight
Sea onlyLike CFR, but the seller also pays for minimum insurance cover to the destination port. Sea only.
Carriage Paid To
Any modeThe seller pays for carriage to the named destination; risk passes to the buyer when the goods are handed to the first carrier.
Carriage and Insurance Paid To
Any modeLike CPT, but the seller also provides insurance cover to the named destination.
Delivered At Place
Any modeThe seller delivers when the goods are ready for unloading at the named destination. The buyer handles import clearance.
Delivered At Place Unloaded
Any modeThe seller delivers and unloads the goods at the named destination.
Delivered Duty Paid
Any modeThe seller takes on everything, including import duties and clearance, delivering the goods ready for the buyer.
This guide is a simple overview. The right Incoterm for your shipment depends on your goods and agreement - contact us and we'll advise.
Not sure which Incoterm to use?
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