Incoterms 2020
The Incoterms® rules (International Commercial Terms) are a series of pre-defined commercial terms published by the International Chamber of Commerce (ICC), widely used in international commercial transactions to define the tasks, costs and risks associated with the transportation and delivery of goods. Accepted by governments, legal authorities and practitioners worldwide, they reduce or remove uncertainties arising from different interpretations of the rules in different countries.
Incoterms 2020 Main Changes
- DAT term changed to DPU (Delivered at Place Unloaded)
- FCA offers two possible options
- CIP requires insurance clause A instead of C
- A new section of costs has been included
- Customs clearance with export, transit and import explanations
- FCA with a Bill of Lading on-board notification if agreed
Quick Reference of Common Trade Terms
| Term | Full Name | Risk / Cost Transfer Point |
|---|---|---|
| EXW | Ex Works | Goods made available at seller’s premises |
| FCA | Free Carrier | Delivered to carrier at named place, export cleared |
| FAS | Free Alongside Ship | Placed alongside vessel, export cleared |
| FOB | Free on Board | Risk transfers once loaded on board |
| CFR | Cost and Freight | Seller pays freight; risk transfers on board |
| CIF | Cost, Insurance and Freight | Freight + insurance paid; risk transfers on board |
| CPT | Carriage Paid To | Freight paid to named destination |
| CIP | Carriage and Insurance Paid To | Freight + insurance (Clause A) paid |
| DAP | Delivered at Place | Delivered to named place, not unloaded |
| DPU | Delivered at Place Unloaded | Delivered and unloaded at named place |
| DDP | Delivered Duty Paid | All costs, risks and import clearance borne by seller |
For reference only. Please refer to the official Incoterms 2020 rules published by the ICC.