Incoterms

Incoterms are the International Rules for the Interpretation of Trade terms as published by the International Chamber of Commerce (ICC). They provide a set of rules for the interpretation of the most common trade  terms used in international trade in order to deal with the differing interpretations and understandings that exist in various countries and trades.

This overview is provided as a guide only. If you need to know more about Incoterms you should visit the International Chamber of Commerce Web Site at www.iccwbo.org.

When a seller and buyer wish to cite Incoterms as applying to the contract of  sale, it is important to cite the term used, title and date applicable as there  have been numerous amendments, e.g.: FOB Incoterms 2000.

Regardless of the Incoterms in use, the seller must supply the goods as  agreed in the contract of sale, together with such evidence of conformity as may  be required by the contract. Regardless of the Incoterms in use, the buyer must take receipt and pay for the goods delivered, as provided in the contract.

Incoterms 2000 are presented in four groups, to which we have added a further table detailing some other trading terms and variations (click on the required Group for fast access):

Group E - Departure (Table 1 - shown together with Group F)
The seller makes the goods available to the buyer at the seller's own premises
EXW - Ex Works

Group F - Main carriage unpaid (Table 1 - shown  together with Group E)
The seller delivers the goods to a carrier appointed by the  buyer
FCA - Free Carrier FAS - Free Alongside Ship FOB - Free Onboard Ship

Group C - Main carriage paid (Table 2)
The seller has to contract for carriage but without assuming the risk of loss of or damage to the goods or additional costs due to events  occurring after shipment and dispatch
CFR - Cost & Freight CIF - Cost, Insurance & Freight CPT - Carriage Paid To CIP - Carriage & Insurance Paid To

Group D - Arrival (Table 3)
The seller has to bear all costs and risks need to bring the goods to the country of destination
DAF - Deliver At Frontier DES - Delivered Ex Ship DEQ - Delivered Ex Quay DDU - Delivered Duty Unpaid DDP - Delivered Duty Paid

Other Trading Terms & Variations (Table 4)
EXF - Ex Factory PAF - Packed At Factory FOB - as used in USA domestic trade FOT - Free On Truck FOR - Free On Rail C&F - Cost & Freight DIS - Delivered Into Store FIS - Free into Store Door To Door Free Domicile

In reading the tables you should have regard to the following notes:
* The payment of the forwarder's fees is sometimes controversial, depending on the contract of sale.

** Risk of loss or damage is transferred from seller to buyer when goods have been delivered to the carrier.

*** Responsibility may be either the buyer or seller.

Table 1 - Departure, Main Carriage Unpaid

* The payment of the forwarder's fees is sometimes controversial, depending  on the contract of sale.
** Risk of loss or damage is transferred from seller to buyer when goods have been delivered to the carrier.
*** Responsibility may be either the buyer or seller

Table 2 - Main Carriage Paid

* The payment of the forwarder's fees is sometimes controversial, depending  on the contract of sale.
** Risk of loss or damage is transferred from seller to buyer when goods have been delivered to the carrier.
*** Responsibility may be either the buyer or seller.

Table 3 - Arrival

Table 4 - Trading Terms & Variations

The International Rules for the interpretation of trade terms are published by the International Chamber of Commerce (ICC). Customs & Forwarding Services (Australia) Pty Ltd is not responsible for any transposing, typographical or other errors.