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Incoterms
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Ex-Works
- EXW
(+ the named place)
- Ex means
"from". Works means "factory, mill
or warehouse", which is the
seller's premises. EXW applies to goods available only at
the seller's premises. Buyer is responsible for loading the
goods on truck or container at the seller's premises, and
for the subsequent costs and risks.
In
practice, it is not uncommon that the seller loads the goods
on truck or container at the seller's premises without
charging loading fee.
In the
quotation, indicate the named place (seller's premises)
after the acronym EXW, for example EXW Kobe
and EXW San Antonio.
The term
EXW is commonly used between the manufacturer (seller)
and export-trader (buyer), and the export-trader resells on
other trade terms to the foreign buyers. Some manufacturers
may use the term Ex Factory,
which means the same as Ex Works.
-
Free Carrier
-
FCA
(+ the named point of departure)
- The delivery of
goods on truck, rail car or container at the specified point
(depot) of departure, which is usually the seller's
premises, or a named railroad station or a named cargo
terminal or into the custody of the carrier, at seller's
expense. The point (depot) at origin may or may not be a
customs clearance center. Buyer is responsible for the main
carriage/freight, cargo insurance and other costs and risks.
In the air
shipment, technically speaking, goods placed in the custody
of an air carrier is considered as delivery on board the
plane. In practice, many importers and
exporters still use the term FOB in the air shipment.
The term
FCA is also used in the
RO/RO (roll on/roll off) services.
In the
export quotation, indicate the point of departure (loading)
after the acronym FCA, for example FCA Hong
Kong and FCA Seattle.
Some
manufacturers may use the former terms
FOT (Free On Truck) and
FOR (Free On Rail) in selling to
export-traders.
-
Free Alongside Ship
-
FAS
(+ the named port of origin)
- Goods are placed in
the dock shed or at the side of the ship, on the dock or
lighter, within reach of its loading equipment so that they
can be loaded aboard the ship, at seller's expense. Buyer is
responsible for the loading fee, main carriage/freight,
cargo insurance, and other costs and risks.
In the
export quotation, indicate the port of origin (loading)
after the acronym FAS, for example FAS New
York and FAS Bremen.
The FAS
term is popular in the break-bulk shipments and with the
importing countries using their own vessels.
-
Free On Board
-
FOB (+ the
named port of origin)
-
- The delivery of
goods on board the vessel at the named port of origin
(loading), at seller's expense. Buyer is responsible for the
main carriage/freight, cargo insurance and other costs and
risks.
In the
export quotation, indicate the port of origin (loading)
after the acronym FOB, for example FOB
Vancouver and FOB Shanghai.
Under the
rules of the INCOTERMS 1990, the term FOB is used for
ocean freight only. However, in practice,
many importers and exporters still use the term FOB
in the air freight.
In North
America, the term FOB has other applications. Many
buyers and sellers in Canada and the U.S.A. dealing on the
open account and consignment basis are accustomed to using
the shipping terms FOB Origin and
FOB Destination.
FOB
Origin means the buyer is responsible for the freight
and other costs and risks. FOB Destination
means the seller is responsible for the freight and other
costs and risks until the goods are delivered to the buyer's
premises, which may include the import customs clearance and
payment of import customs duties and taxes at the buyer's
country, depending on the agreement between the buyer and
seller.
In
international trade, avoid using the
shipping terms FOB Origin and
FOB Destination, which are not part of the
INCOTERMS (International Commercial Terms).
-
Cost and Freight
-
CFR (+ the
named port of destination)
-
- The delivery of
goods to the named port of destination (discharge) at the
seller's expense. Buyer is responsible for the cargo
insurance and other costs and risks. The term CFR was
formerly written as C&F. Many importers and exporters worldwide
still use the term C&F.
In the
export quotation, indicate the port of destination
(discharge) after the acronym CFR, for example
CFR Karachi and CFR Alexandria.
Under the
rules of the INCOTERMS 1990, the term Cost and Freight
is used for ocean freight only. However, in practice, the term Cost and Freight (C&F) is
still commonly used in the air freight.
-
Cost, Insurance and Freight
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CIF
(+ the named port of destination)
-
- The cargo insurance
and delivery of goods to the named port of destination
(discharge) at the seller's expense. Buyer is responsible
for the import customs clearance and other costs and risks.
In the
export quotation, indicate the port of destination
(discharge) after the acronym CIF, for example
CIF Pusan and CIF Singapore.
Under the
rules of the INCOTERMS 1990, the term CIF is used for
ocean freight only. However, in practice,
many importers and exporters still use the term CIF
in the air freight.
-
Carriage Paid To -
CPT
(+ the named place of destination)
- The delivery of
goods to the named place of destination (discharge) at
seller's expense. Buyer assumes the cargo insurance, import
customs clearance, payment of customs duties and taxes, and
other costs and risks.
In the
export quotation, indicate the place of destination
(discharge) after the acronym CPT, for example
CPT Los Angeles and CPT Osaka.
-
Carriage and Insurance Paid To
-
CIP
(+ the named place of destination)
- The delivery of
goods and the cargo insurance to the named place of
destination (discharge) at seller's expense. Buyer assumes
the import customs clearance, payment of customs duties and
taxes, and other costs and risks.
In the
export quotation, indicate the place of destination
(discharge) after the acronym CIP, for example
CIP Paris and CIP Athens.
-
Delivered At Frontier -
DAF
(+ the named point at frontier)
- The delivery of
goods to the specified point at the frontier at seller's
expense. Buyer is responsible for the import customs
clearance, payment of customs duties and taxes, and other
costs and risks.
In the
export quotation, indicate the point at frontier (discharge)
after the acronym DAF, for example DAF
Buffalo and DAF Welland.
-
Delivered Ex Ship
-
DES (+ the
named port of destination)
- The delivery of
goods on board the vessel at the named port of destination
(discharge), at seller's expense. Buyer assumes the
unloading fee, import customs clearance, payment of customs
duties and taxes, cargo insurance, and other costs and
risks.
In the
export quotation, indicate the port of destination
(discharge) after the acronym DES, for example
DES Helsinki and DES Stockholm.
-
Delivered Ex Quay
-
DEQ (+ the
named port of destination)
- The delivery of
goods to the quay (the port) at destination at seller's
expense. Seller is responsible for the import customs
clearance and payment of customs duties and taxes at the
buyer's end. Buyer assumes the cargo insurance and other
costs and risks.
In the
export quotation, indicate the port of destination
(discharge) after the acronym DEQ, for example
DEQ Libreville and DEQ Maputo.
-
Delivered Duty Unpaid
-
DDU
(+ the named point of destination)
- The delivery of
goods and the cargo insurance to the final point at
destination, which is often the project site or buyer's
premises, at seller's expense. Buyer assumes the import
customs clearance and payment of customs duties and taxes.
The seller may opt not to insure the goods at his/her own
risks.
In the
export quotation, indicate the point of destination
(discharge) after the acronym DDU, for example
DDU La Paz and DDU Ndjamena.
-
Delivered Duty Paid -
DDP
(+ the named point of destination)
- The seller is
responsible for most of the expenses, which include the
cargo insurance, import customs clearance, and payment of
customs duties and taxes at the buyer's end, and the
delivery of goods to the final point at destination, which
is often the project site or buyer's premises. The seller
may opt not to insure the goods at his/her own risks.
In the
export quotation, indicate the point of destination
(discharge) after the acronym DDP, for example
DDP Bujumbura and DDP Mbabane.
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