What Are Incoterms? – A list of Intercoms used in customs declarations.
Incoterms® rules are a set of 11 globally recognized standard trade terms that faciliate domestic and international business to business sale of goods.
What Are Incoterms? Below is a list of common Incoterms.
- Group – Departure. The seller makes the goods available to the buyer at the seller’s discretion.
- F Group – Used when the seller arranges and pays for some transport within the seller’s country
- C Group – Used when the seller arranges and pays for most of the freight charges up to the foreign country.
- D Group – Used when the seller arranges and pays for most of the delivery charges to the foreign country
E GroupEX Works (EXW)The seller makes the goods available to the buyer to collect at the sellers named place. The buyer bears all of the risk and costs from the moment the goods are collected. The buyer has the obligation to clear the goods for export and import.
Free Carrier (FCA)The seller makes the goods available at the sellers named place and is responsible for loading the goods onto the buyer’s transport. The seller is responsible for the transport of the goods to the port and for making the export declaration.
Free Alongside Ship (FAS)The seller is responsible for the export declaration. The seller delivers the goods when the goods are placed alongside the vessel at the named quay or port. All costs and risks pass to the buyer from that point.
Free on Board (FOB)The seller is responsible for the export declaration and for delivering the goods on board the vessel at the port nominated by the buyer. All costs and risk transfer to the buyer from that point.
Cost and Freight (CFR)The seller is responsible for the export declaration and for delivering the goods on board the vessel at the port nominated by the buyer. The seller must pay the costs and freight necessary to deliver the goods to the named port of destination.
Cost Insurance and Freight (CIF)The seller is responsible for the export declaration and for delivering the goods on board the vessel at the port nominated by the buyer. The seller must pay the costs and freight necessary to deliver the goods to the named port of destination. The seller is also responsible for insurance cover against the buyers risk of loss or damages to the goods during the carriage.
Carriage Paid To (CPT)The seller makes the export declaration and delivers the goods to the carrier at the place of shipment. The seller is responsible for the international transport costs. The risk is transferred from seller to buyer when the goods are delivered to the international carrier.
Carriage and Insurance Paid To (CIP)The seller makes the export declaration and delivers goods to the carrier at a named place of shipment, which is the point where the risk transfers to the buyer.The seller is responsible for transport costs and insurance to the point of the named place.
Delivered at Place (DAP)The seller makes the export declaration and bears all the risk and costs and delivers goods to the foreign named place unloaded. The named place under DAP can be any place on the buyers side that is agreed upon by both parties.
Delivered at Place Unloaded (DPU)Previously named Delivered at Terminal (DAT)DPU is very similar to DAP except that the seller must pay for the unloading of the goods. The seller makes the export declaration and bears all the risk and costs and delivers goods to the foreign named place unloaded.
Delivery Duty Paid (DDP)The seller makes the export declaration on their side and is also responsible for the import declaration on the buyer’s side. The seller takes all of the risk and the costs until the goods have been delivered at the buyers named place. The seller also is responsible for paying any duties owing from the import of the goods by the buyer.
What Are Incoterms? – If you need more information on Incoterms and how to complete a customs declaration contact Custran today. Click here.
