Incoterms 2000 Definitions

Incoterms 2000 contains 13 rules for standardized global trade, defining the most important responsibilities of buyers and sellers in international sales contracts for specific situations/means of transport. This information is based on international rules for the interpretation of trade terms as published by the International Chamber of Commerce ( ICC). In order to ensure that the Incoterms 2000 are being applied, buyers and sellers should specify incoterms 2000 on all contracts, thus, clearly identifying the source of reference for the definition. Traders should also clearly specify any and all agreed variations/changes to the terms. GROUP A: DEPARTURE Under EXW, the seller minimizes his risk by only making the goods available at his own premises. EXW - EX WORKS (named place) Any mode of transport; seller makes goods available to buyer at seller's premises or other location, not cleared for export and not loaded on a vehicle. The buyer bears all risks and costs involved in taking the goods from the seller's premises and thereafter. GROUP F: MAIN CARRIAGE UNPAID Under F terms, and under FCA unless otherwise agreed, the seller arranges and pays for the pre-carriage in the country of export. FCA -FREE CARRIER (named place) Any mode of transport; seller delivers goods, cleared for export, to the carrier named by the buyer at the specified place. If delivery occurs at the seller's premises, the seller is responsible for loading; if delivery occurs elsewhere, the seller must load the conveyance but is not responsible for unloading. Maritime and inland waterway only; seller delivers when the goods are placed alongside the vessel at the named port of shipment. The seller also clears the goods for export. Maritime and inland waterway only; seller delivers when the goods pass the ship's rail at the named port. The seller clears the goods for export.

FAS - FREE ALONGSIDE SHIP (named port of shipment)

FOB - FREE ON BOARD (named port of shipment) GROUP C: MAIN CARRIAGE PAID Under C terms, the seller arranges and pays for the main carriage but without assuming the risk of the main carriage. CFR - COST AND FREIGHT (named Maritime and inland waterway only; seller delivers when the goods pass the ship's rail port of destination) at the port of export. The seller pays cost and freight for bringing the goods to the foreign port and clears the goods for export.

CIF - COST, INSURANCE, AND FREIGHT (named port of destination) CIP - CARRIAGE AND INSURANCE PAID TO (named place of destination)

CPT - CARRIAGE PAID TO (named place of destination) GROUP D: ARRIVAL Under D terms, the seller's cost/risk is maximized because he must make the goods available upon arrival at the agreed destination. DAF - DELIVERED AT FRONTIER Any mode of transport to a land frontier; seller delivers when goods are placed at the (named place) buyer's disposal on the "arriving means of transport" (not unloaded), cleared for export but not cleared for import before the customs border of the destination country. DES - DELIVERED EX SHIP (named Maritime and inland waterway only; seller delivers when goods are at the buyer's port of destination) disposal on board the ship not cleared for import. The buyer pays discharging costs. DEQ - DELIVERED EX QUAY (named Maritime and inland waterway only; seller delivers when the goods are placed at the port of destination) buyer's disposal, not cleared for import, on the dock (quay) at the named port of destination. The seller pays discharging costs, but the buyer pays for import clearance. DDU - DELIVERED DUTY UNPAID Any mode of transport; seller delivers the goods to the buyer not cleared for import (named place of destination) and not unloaded from the arriving means of transport at the named destination, but the buyer is responsible for all import clearance formalities and costs. DDP - DELIVERED DUTY PAID Any mode of transport; seller delivers goods to the buyer, cleared for import (including (named place of destination) import license, duties, and taxes) but not unloaded from the means of transport. The following resources will be helpful for anyone who wants to learn more about the Incoterms: - Incoterms 2000 - The International Chamber of Commerce - ICC Guide to Incoterms 2000

Maritime and inland waterway only; seller delivers when the goods pass the ship's rail at the port of export. The seller pays cost and freight for bringing the goods to the foreign port, obtains insurance against the buyer's risk of loss or damage, and clears the goods for export. Any mode of transport; seller delivers the goods to a carrier it nominates but also pays the cost of bringing the goods to the named destination. The seller also obtains insurance against the buyer's risk of loss or damage during carriage and clears the goods for export. Any mode of transport; seller delivers goods to carrier it nominates and pays costs of bringing goods to the named destination. The seller also clears the goods for export.

This matrix is intended to be for reference only, for more information please refer to Incoterms 2000
INCOTERMS 2000
Group E: Departure Group F: Main Carriage Unpaid Group C: Main Carriage Paid GROUP D: ARRIVAL

EXW Terms of Sale

FCA

FAS

FOB

CFR

CIF

CPT**

CIP**

DAF

DES

DEQ

DDU

EXWORKS (Named place)

FREE CARRIER (Named place)

FREE ALONGSI DE SHIP (Named port of shipment)

FREE ONBOARD VESSEL (Named port of shipment)

COST & FREIGHT (Named port of destination)

COST INSURANCE FREIGHT (Named port of destination)

CARRIA CARRIAGE GE PAID INSURANCE, TO PAID TO (Named (Named place) place of destination)

DELIVERED AT FRONTIER (Named place)

DELIVERED EX-SHIP (Named port of destination)

DELIVERED EX-QUAI DUTY PAID (Named port of destination)

DELIVERED DUTY UNPAID (Named place of destination)

Responsibility & Charges WAREHOUSE SERVICES AT POINT OF ORIGIN (STORAGE & LABOR) EXPORT PACKING LOADING AT POINT OF ORIGIN INLAND FREIGHT

SELLER

SELLER

SELLER

SELLER

SELLER

SELLER

SELLER SELLER SELLER SELLER SELLER SELLER SELLER SELLER SELLER SELLER SELLER SELLER

SELLER BUYER BUYER

SELLER SELLER * BUYER/ SELLER BUYER/ SELLER SELLER BUYER* BUYER BUYER BUYER BUYER BUYER

SELLER SELLER SELLER

SELLER SELLER SELLER

SELLER SELLER SELLER

SELLER SELLER SELLER

SELLER SELLER SELLER SELLER SELLER SELLER

SELLER SELLER

SELLER SELLER SELLER SELLER SELLER SELLER SELLER SELLER SELLER BUYER BUYER BUYER BUYER BUYER BUYER SELLER SELLER BUYER BUYER BUYER BUYER BUYER SELLER SELLER SELLER BUYER BUYER BUYER BUYER SELLER SELLER SELLER SELLER BUYER* BUYER BUYER SELLER SELLER SELLER SELLER SELLER SELLER BUYER BUYER BUYER BUYER SELLER BUYER BUYER BUYER SELLER SELLER SELLER BUYER/ SELLER BUYER

SELLER

SELLER

SELLER

PORT RECEIVING CHARGES CUSTOMS CLEARANCE EXPORT LOADING ON OCEAN CARRIER OCEAN/AIR FREIGHT INSURANCE CHARGES IN FOREIGN PORT/AIRPORT CUSTOMS CLEARANCE/DUTIES IMPORT DELIVERY CHARGES TO FINAL DESTINATION (INLAND FREIGHT + UNLOADING)

BUYER

SELLER SELLER SELLER SELLER BUYER/ SELLER BUYER BUYER

SELLER SELLER SELLER SELLER BUYER/ SELLER SELLER BUYER

SELLER SELLER SELLER SELLER SELLER SELLER BUYER

BUYER BUYER BUYER BUYER BUYER BUYER BUYER

BUYER

BUYER Any mode, including multimod al Any (Ocean, Air, Rail, Truck)

BUYER

BUYER

SELLER

RECOMMENDED MODE OF TRANSPORT

Ocean

Ocean

Ocean

Ocean

Any

Any

Any

Ocean

Ocean

Any

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. OTHER IMPORTANT NOTES: 1) Incoterms only relate to trade terms in the contract of sale between the buyer and seller and do not deal with the contract for carriage. 2) The roles and responsibilities listed on this page can be modified as long as there is an agreement between the buyer and seller. 3) 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. 4) Only two incoterms (CIP and CIF) express when insurance is to be bought and issued on minimum coverage. 5) Under the shipping terms indicated above, the buyer must pay the cost of any pre-shipment inspection, except when it is mandated by the authorities of the country of export.