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INCOTERMS 2010 RULES

Rules for Shipment by Air, Road, Sea, or Multimodal

EXW
EX Work
(...named place of delivery)

Carriage

Loading and carriage of the goods from the "named place of delivery" are arranged by the buyer

Risks

Risk transfers from SELLER to Buyer when the goods are made available to BUYER at SELLER's "named place of delivery" not loaded

Costs

Costs transfers from SELLER to BUYER when the goods are made available to BUYER at SELLER'S "named place of delivery" not loaded

FCA
Free Carrier
(...named place of delivery)

Carriage

Carriage is arranged by the BUYER or by the SELLER on behalf of the BUYER

Risks

Risk transfers from the SELLER to the BUYER when the goods have been delivered to the CARRIER at the "named place of delivery"

Costs

Costs Transfers from the SELLER to the BUYER when the goods have been delivered to the CARRIER at the "named place of delivery"

CPT
Carriage Paid To
(...named place of destination)

Carriage

Carriage of the goods to the "named place destination" are arranged by the SELLER

Risks

Risk transfers from the SELLER to the BUYER when the goods have been delivered to the (first) CARRIER

Costs

Costs transfer from the SELLER to the BUYER at the "named place of destination"

CIP
Carriage and Insurance Paid to
(...named place of destination)

Carriage

Carriage of the goods and insurance to the "named place of destination" are arranged by the SELLER

Risks

Risk transfers from the SELLER to the BUYER when the goods have been delivered to the (first) CARRIER

Costs

Costs transfer from the SELLER to the BUYER at the "named Place of destination"

DAT
Delivered At Terminal
(...named terminal at port or place of destination)

Carriage

Carriage of the goods to the "named terminal at port or place of destination," unloaded, is arranged by the SELLER

Risks

Risk transfers from the SELLER to the BUYER when the goods are made available to the BUYER at the "named terminal at port or place of destination," unloaded

Costs

Costs transfers from the SELLER to the BUYER when the goods are made available to the BUYER at the "named terminal at port or Place of destination," unloaded

DAP
Delivered At Place
(...named place of destination)

Carriage

Carriage of the goods to the "named place of destination," ready for unloading, is arranged by the SELLER

Risks

Risk transfers from the SELLER to the BUYER when the goods are made available, ready for unloading at the "named place of destination"

Costs

Costs transfers from the SELLER to the BUYER when the goods are made available, ready for unloading at the "named place of destination"

DDP
Delivered Duty Paid
(...named place of destination)

Carriage

Carriage of the goods to the "named place of destination," ready for unloading, is arranged by the SELLER

Risks

Risk transfers from the SELLER to the BUYER when the goods are made available ready for unloading at the "named place of destination"

Costs

Costs transfer from the SELLER to the BUYER when the goods are made available ready for unloading, cleared for import, at the "named place of destination"

Rules for Shipment By Sea and Inland Waterway Only

FAS
Free Alongside Ship
(...named port of shipment)

Carriage

Pre-carriage of the goods is arranged by the SELLER Main carriage of the goods is arranged by the BUYER

Risks

Risk transfers from the SELLER to the BUYER when the goods have been placed alongside the ship a the "named port of shipment"

Costs

Costs transfer from the SELLER to the BUYER when the goods have been placed alongside the ship at the "named port of shipment"

FOB
Free On Broad
(...named port of destination)

Carriage

Pre-carriage of the goods is arranged by the SELLER Main carriage of the goods is arranged by the BUYER

Risks

Risk transfers from the SELLER to the BUYER when the goods are loaded on board the ship at the "named port of shipment"

Costs

Costs transfer from the SELLER to the BUYER when the goods are loaded on board the ship at the "named port of shipment"

CFR
Cost and Freight
(...named port of destination)

Carriage

Carriage of the goods to the "named port of destination" is arranged by the SELLER Onward carriage is arranged by the BUYER

Risks

Risk transfers from the SELLER to the BUYER when the goods are loaded on board the ship at the "named port of shipment" (not destination)

Costs

Costs transfer from the SELLER to the BUYER upon delivery of the goods, not unloaded, at the "named port of destination"

CIF
Cost, Insurance and Freight
(...named port of destination)

Carriage

Carriage of the goods and Insurance to the "named port of destination" is arranged by the SELLER onward carriage is arranged by the BUYER

Risks

Risk transfers from the SELLER to the BUYER when the goods are loaded on board the ship at the "named port of shipment" (not destination)

Costs

Costs transfer from the SELLER to the BUYER upon delivery of the goods, not unloaded, at the "named port of destination"

Notes on INCOTERMS 2010 RULES (Entry into force: January 1, 2011)

Incoterms 2010 rules are internationally accepted standard definitions of trade terms (International Commercial TERMS). Incoterms were developed by the ICC (International Chamber of Commerce), Paris, France, in 1936, and have been regularly revised to reflect changes in transportation and documentation, the current version is Incoterms 2010 (www.iccwbo.org).

Incoterms 2010 rules are not implied into contracts. Buyers and sellers must specify in their contract that it is subject to Incoterms 2010.

Incoterms 2010 rules DO a) apply to the sale of goods, b) specify each party's obligations regarding carriage, risks, and costs, and c) establish basic terms of transport and delivery.

Incoterms 2010 rules DO NOT a) apply to contracts for services, b) define contractual rights other than for delivery, c) specify details of the transfer, transport, and delivery of goods, d) determine how title to goods will transfer, e) protect seller or buyer from risk of loss, f) cover the goods before or after delivery, or g) define remedies for breach of contract.

"Delivery" in Incoterms 2010 rules is used to "indicate where the risk of loss or damage to the goods passes from the seller to the buyer."

"Pre-Carriage" indicates the movement of goods prior to the main carriage of the shipment.

"Onward Carriage" indicates the movement of goods after the main carriage of the shipment.

This guide is for easy reference only. For a comprehensive guide to Incoterms 2010, refer to the "dictionary of International Trade, 9th Edition," also by the World Trade Press.

Incoterms is a registered trademark of the ICC (International Chamber of Commerce) and is used here for informational purposes only. This illustrated guide is independently authored and publish and is not sponsored or endorsed by, or affiliated with, the ICC. Incoterms 2010 rules full test is available from the ICC (www.iccwbo.org).

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