Incoterms Conditions
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LOGITRANS SERVICESWhat Are Incoterms Conditions?
They are international trade clauses that define the delivery terms, the allocation of delivery costs, and the transfer of risk between the seller and the buyer within a commercial contract.
What Is Their Purpose?
Incoterms define the responsibilities and obligations of the seller and the buyer when the transport of goods is involved. These rules prevent avoidable expenses and disputes.
– Legal –
Most Common Incoterms Conditions
EXW
The seller makes the goods available at their premises, and the buyer is responsible for collecting them. The seller bears no costs or risks related to transportation — these fall entirely to the buyer.
DAP
The seller is responsible for delivering the goods to a specified, authorized location.
Once the goods are ready for unloading, the seller’s responsibility ends. The buyer then assumes all costs related to unloading from that point onward.
DDP
The seller is responsible for all costs associated with delivering the goods to a specified destination, including customs duties and taxes.
The buyer is responsible only for unloading the goods.
Other Incoterms Conditions
CIF
The seller must deliver the goods to a specified destination port and pay all associated costs, including loading, transportation, and insurance.
The buyer is responsible for unloading the goods upon arrival.
FCA
The seller delivers the goods, cleared for export and properly packed, to a specified location.
The buyer is responsible for arranging and paying for transportation and insurance from that point onward.
FOB
The seller delivers the goods on board a named vessel in the port of shipment.
From that moment, the buyer takes responsibility for loading, transport, and insurance.
CFR
Similar to CIF — the seller pays costs for loading and transportation to a destination port.
However, risk transfers to the buyer once the goods are loaded onto the vessel.
CIP
The seller pays transportation and insurance costs to a specified destination.
CPT
The seller pays all transportation costs to a specified destination.
Risk and any additional costs beyond that point transfer to the buyer.
Often used for door-to-door deliveries.
FAS
The seller delivers the goods alongside a named vessel at the port of shipment.
The buyer is responsible for loading, further transport, and insurance from that point onward.
