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Thursday, 02nd July 2020
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Incoterms

To be used with all transport types:

EXW

Ex Works: Seller delivers when they place goods at disposal of buyer at the seller’s premises or another named place not cleared for export and not loaded on any collecting vehicle. Buyers bear all risks.

FCA

Free Carrier: Seller delivers the goods, cleared for exports, to the carrier nominated by the buyer at the named place. If deliver occurs at seller’s premises, the seller is responsible for loading at the sellers place.

CPT

Carriage Paid To: Seller delivers the goods to the carrier nominated by him. Seller pays costs to agreed destination. Buyer bear all risks pays until delivery to first carrier has taken place.

CIP

Carriage and Insurance Paid To: Same as CPT – but insurance against the buyer’s risk of loss or damage to the goods during the carriage. If subsequent carriers are used for the carriage to the agreed destination, the risk passes when the goods are delivered.

DAT

Delivered at Terminal: Seller pays for carriage to the terminal, except for costs related to import clearance, and assumes all risks up to the point that the goods are unloaded at the terminal. ‘Terminal’ could be anywhere determined by buyer, such as dockside, warehouse, container terminal, railway terminal, airport, etc.

DAP

Delivered at Place: Seller pays for carriage to the named place, except for costs related to import clearance, and assumes all risks prior to the point that the goods are ready for unloading by the buyer.

DDP

Delivered Duty Paid: Seller is responsible for delivering the goods to the named place in the country of the buyer, and pays all costs in bringing the goods to the destination including import duties and taxes. This term places the maximum obligations on the seller and minimum obligations on the buyer. Unloading at buyers is not paid by seller.

To be used on with sea transportation only – Port to Port

FAS

Free Alongside Ship: Seller must place the goods alongside the vessel at the named port. Buyer has to bear all costs and risk of loss or damage to the goods from that moment. FAS require the seller to clear the goods for exports.

FOB

Free on Board: Seller must load the goods on board the vessel nominated by the buyer. Cost and risk are divided when the goods are actually on board of the vessel by passing the ship’s rail at the name port of shipment. Buyers bear all the costs and risks of loss or damage to the goods from that point. Seller must clear the goods for export.

CFR

Cost and Freight: Seller must pay the costs and freight to bring the goods to the port of destination. However, risk is transferred to the buyer once the goods are loaded on the vessel by passing the ship’s rail at the name port of shipment. Note that insurance for the goods is NOT included.

CIF

Cost, Insurance and Freight: Same as CFR – except that the seller must in addition procure and pay for the insurance.

Click here to view Incoterms 2010 terms