Incoterms represent a global standard on how responsibilities, costs and risks are shared in international trade.
Incoterms are globally recognized standardized rules for the distribution of obligations, costs, and risks in the international movement of goods. They specify which contractual partners are responsible for organizing transportation, loading and unloading, transportation insurance, various costs, and import and export clearance. The most important regulatory content, however, is the complexity of the transfer of risk with regard to accidental loss, accidental damage, or other deterioration of the goods.
Since January 1, 2010, the globally revised Incoterms have been in force. Here is a summary of the most critical and relevant modifications:
reduction from 13 to 11 rules
Incoterms DAT (delivery at terminal) and DAP (delivery at place) replace the previous clauses DEQ, DAF, DES, and DDU.
New rules for transfer of risk for sea freight transportation
Separation of Incoterms into two groups
Group 1
Includes those rules that can be used for any type of transportation or combined transportation
EXW – Ex Works (named place)
FCA – Free Carrier (named place)
CPT – Carriage Paid To (named place of destination)
CIP – Carriage and Insurance Paid To (named place of destination)
DAT – Delivered at Terminal (named place of destination)
DAP – Delivered at Place (named place of destination)
DDP – Delivered Duty Paid (named place of destination)
Group 2
Used only for ocean freight or inland waterway transportation
FAS – Free Alongside Ship (named port of shipment)
FOB – Free On Board (named port of shipment)
CFR – Cost and Freight (named port of shipment)
CIF – Cost, Insurance, Freight (named port of shipment)
Further Information
For more information please visit the Website of the International Chamber of Commerce.