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Incoterms
The purpose of Incoterms is to provide a set of international rules for the interpretation of the most commonly used trade terms in foreign trade. Thus, the uncertainties of different interpretations of such terms in different countries can be avoided or at least reduced to a considerable degree.
The terms are grouped into four different categories:
- the E term - Ex works
the seller only makes the goods available to the buyer at the seller's own premises - the F terms - FCA, FAS, FOB
the seller must deliver the goods to a carrier appointed by the buyer - the C terms - CFR, CIF, CPT, CIP
the seller has to contract for carriage, but without assuming the risk of loss of or damage to the goods after shipment and dispatch - the D terms - DAF, DES, DEQ, DDU, DDP
the seller must bear all costs and risks needed to bring the goods to the place of destination
| Term | Explanation | |
|---|---|---|
| Group E - Departure | EXW | Ex Works (... named place) |
| Group F - Main Carriage Unpaid | FCA FAS FOB | Free Carrier (... named place) Free Alongside Ship (... named port of shipment) Free on Board (... named port of shipment) |
| Group C - Main Carriage Paid | CFR CIF CPT CIP | Cost and Freight (... named port of destination) Cost, Insurance and Freight (... named port of destination) Carriage Paid To (... named place of destination) Carriage and Insurance Paid To (... named place of destination) |
| Group D - Arrival | DAF DES DEQ DDU DDP | Delivered at Frontier (... named place) Delivered Ex Ship (... named port of destination) Delivered Ex Quay (... named port of destination) Delivered Duty Unpaid (... named place of destination) Delivered Duty Paid (... named place of destination) |
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