Incoterms

Incoterms® 2020 are a set of internationally recognized rules, published by the International Chamber of Commerce (ICC), that define the responsibilities of buyers and sellers in international sales contracts regarding the delivery of goods, including tasks, costs, and risks. They provide a common framework to standardize international trade, covering 11 rules that are split into those applicable to any mode(s) of transport and those specifically for sea or inland waterway transport. They establish a common understanding for parties in an international trade transaction. Incoterms® clearly define the duties and obligations of both the seller and the buyer at each stage of the transaction. The rules specify who is responsible for various costs associated with the shipment. They clarify when the risk of loss or damage to goods transfers from the seller to the buyer. Incoterms® guide who arranges and pays for transport, insurance, and customs formalities.

INCOTERMS applicable for any mode of transport:	Export Customs Clearance	Import Customs Clearance	Who Pays Tariffs?
EXW (Ex Works)	Buyer	Buyer	Buyer
The seller makes the goods available at their premises where the buyer is responsible for all transportation and delivery costs including the risks for bringing the goods to the final destination.
FCA (Free Carrier)	Seller	Buyer	Buyer
The seller delivers the goods into the custody of the carrier nominated by buyer where the passing of risk occurs and the buyer pays for all the transportation and delivery costs.
CPT (Carriage Paid To)	Seller	Buyer	Buyer
The seller pays for the cost of transportation to the agreed place of destination while buyer is responsible for all other costs, including customs clearance and delivery to their final destination.
CIP (Carriage and Insurance Paid To)	Seller	Buyer	Buyer
The seller pays for the cost of transportation and insurance to the agreed place of destination while the buyer is responsible for all other costs, including customs clearance and delivery to their final destination.
DAP (Delivered At Place)	Seller	Buyer	Buyer
The seller delivers to the named place of destination (ready for unloading). Buyer handles import clearance, duties, and unloading.
DPU (Delivered at Place Unloaded)	Seller	Buyer	Buyer
The seller delivers the goods to a specified destination and bears all risks and costs, including export duties, transport, and unloading, until the goods are at the designated destination.
DDP (Delivered Duty Paid)	Seller	Seller	Seller
The seller pays for all transportation costs, import duties and bear all risks until the goods have been delivered to buyer's designated premises.

INCOTERMS applicable for sea and inland waterway mode only:	Export Customs Clearance	Import Customs Clearance	Who Pays Tariffs?
FAS (Free Alongside Ship)	Seller	Buyer	Buyer
The seller delivers the goods alongside the vessel at the agreed port of shipment where the passing of risks occurs and the buyer is responsible for all transportation and delivery costs.
FOB (Free On Board)	Seller	Buyer	Buyer
The seller delivers the goods on board the vessel at the agreed port of shipment where the passing of risks occurs when the goods pass the ship's rail and the buyer is responsible for all transportation and delivery costs.
CFR (Cost and Freight)	Seller	Buyer	Buyer
The seller delivers the goods on board the vessel at the agreed port of shipment and pays for the cost of transportation to the agreed port of destination and the buyer is responsible for all other costs, including customs clearance and delivery to their final destination.
CIF (Cost, Insurance and Freight)	Seller	Buyer	Buyer
The seller delivers the goods on board the vessel at the agreed port of shipment and pays for all the cost of transportation and insurance to the agreed port of destination but risk passes to buyer once goods are onboard at the port of shipment. From the destination port onwards, the buyer is responsible for all other costs, including customs clearance and delivery to their final destination.

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