INCO Terms

1. What are INCOTerms?

INCOTERMS (International Commercial Terms) are an internationally recognised set of trade term definitions developed by the International Chamber of Commerce (ICC). The terms define the trade contract responsibilities and liabilities between a buyer and a seller. They cover who is responsible for paying freight costs, insuring goods in transit and covering any import/export duties, for example. They are invaluable as, once importer and exporter have agreed on an INCOTERM, they can trade without discussing responsibilities for the costs and risks covered by the term.

2. Commonly used INCOTerms.

EXW – Ex-Works or Ex-Warehouse

FCA – Free Carrier

FCA – Free Carrier

FAS – Free Alongside Ship

FOB – Free On Board

CFR – Cost and Freight

CIF – Cost, Insurance and Freight

CPT – Carriage Paid To

CIP – Carriage And Insurance Paid To

DAP – Delivered At Place

DPU – Delivered At Place Unloaded (replaces Incoterm® 2010 DAT)

DDP – Delivered Duty Paid