Incoterms.

Incoterms: They appear regularly when buying and selling products and goods. But what do they mean and what exactly are they for? Officially, Incoterms provide for a precise division of the obligations of seller and buyer in (international) transport agreements.

Incoterms (international delivery terms): What's in it?

Incoterms (international delivery terms): What's in it?
Incoterms describe the role of the buyer and seller in an international trade agreement. Who is to do what and when? The contract between the two parties specifies the following matters:

N

The obligations of the buyer and seller with regard to transport

N

Who organizes the insurance, permits, approvals and all other formalities?

N

Who organizes the transport where and is responsible for it?

N

When do the costs and risks pass from the seller to the buyer?

There are 11 different Incoterms. This number has not changed after the implementation of the changes on 1 January 2020. The Incoterm DAT has been cancelled and the Incoterm DPU has been added. There are 4 Incoterms specific to water transport (maritime and inland waterways). However, this is not an obligation: the other 7 Incoterms can also be used for transport by water. It does not work the other way round: the 4 "water" Incoterms cannot be used for road or rail transport.

The Incoterms at a glance:

Incoterms for all modes of transport:

  • EXW - Ex Works / ex works
  • FCA - Free Carrier / Freight Free to the (first) Carrier
  • CPT - Carriage Paid To / Fracht bezahlt bis
  • CIP - Carriage and insurance paid to / Freight and insurance paid to
  • DPU - Delivered at Place Unloaded (previously: DAT)
  • DAP - Delivery At Place / Delivery at destination
  • DDP - Delivery Duty Paid / delivered and fees paid

Incoterms for water transport:

  • FAS - Free Alongside Ship / Freight free alongside ship
  • FOB - Free On Board / freight free on board
    CFR - Cost and Freight / Kosten und Fracht
  • CIF - Cost, Insurance and Freight / Kosten, Versicherung und Fracht

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