EXW (Ex-works)
The seller meets his commitments by making the goods available for the buyer to pick up at his premises or any
other place agreed upon (i.e. warehouse, factory, etc.) on a date decided by both parties or within an agreed-upon timeframe.
The seller needs to provide the buyer the required information for the delivery of the goods. In these terms,
the buyer carries all the risk and costs starting from the moment the goods are made available to the buyer at the seller’s
location or other named place till the goods are delivered to the buyer. The seller has no responsibility to load the goods or clear them for export.
FCA (Free Carrier)
The seller is responsible for making the goods available either at his own premises or at a place agreed upon.
In either case, the seller is responsible for loading the goods on the buyer's transport and for the delivery to
the port and export clearance including security obligations. Risk gets transferred once the goods are loaded on the buyer’s transport.
CPT (Carriage Paid to)
The seller clears the goods for export and gets it delivered to the carrier or another person specified
by the seller at a named place of shipment. The seller is responsible for the international transportation
costs related to the goods delivery to the named foreign place of destination. The risk transfer, on the other hand,
shifts from the seller to the buyer as soon as the goods are delivered to the carrier/person. This means that the buyer
shoulders the risk of loading the goods on the carrier during the international transport of the goods.
CIP (Carriage and Insurance Paid To)
The seller clears the goods for export and delivers them to the carrier or another person
specified by the seller at a named place of shipment, at which point the risk shifts to the buyer.
The seller is accountable for the transportation costs related to delivery of the goods and acquiring
insurance coverage to the named place. The amount of insurance that the seller must buy needs to be at
least 110% of the value of the goods and transportation costs as detailed in Clause A of the Institute Cargo Clauses.
DPU (Delivered at Place Unloaded)
Earlier known as Delivered at Terminal (DAT), this term has been renamed
Delivered at Place Unloaded (DPU) because the buyer and/or seller may want
the goods delivery to happen at a place other than a terminal.
This term is often used for consolidated containers with more than one consignee.
DPU is highly similar to DAP except that the seller has to pay for unloading the goods.
Like DAP, the seller clears the goods for export and bears all risks and costs associated
with goods delivery to the named place, which can be a port or other named location in
the foreign destination. The buyer is accountable for all costs and risks after this
point including clearance of the goods for import at the named place of destination.
DAP (Delivered at Place)
The seller clears the goods for export and shoulders all the risks and costs associated with
delivering the goods to the named foreign destination to the point before unloading the goods.
DAP incoterm implies that the buyer is accountable for all costs and risks associated with
unloading the goods and clearing customs to import the goods into the named place of destination.
The named place under this term can be a port, the buyer's location or any other place that is
agreed upon by both the buyer and the seller.
DDP (Delivered Duty Paid)
This term implies that the seller bears all risks and costs associated with
delivering the goods to the named place of destination ready for unloading
and cleared for import. DDP is a risky option for the seller, because the
seller may not be fully aware of the import clearance practices in the country
of import or how to find a capable local customs broker. The seller must alsdeal
in a foreign currency, which means they are responsible for the currency exchange
and the related risks. Additionally, every country has different customs requirements
which if not known to the shipper, can delay the shipment. The buyer bears lesser liability and fewer costs in DDP.
CIF (Cost, Insurance and Freight)
The seller clears the goods for export and delivers them when they are on board the vessel at
the port of origin. The seller bears the cost of freight and insurance to the named port of destination.
The seller needs to purchase the minimum level of insurance under Clause C of the Institute Cargo Clauses.
The buyer is accountable for all costs associated with unloading the goods at the named port of destination
and clearing goods for import. The risk transfers from the seller to the buyer once the goods are on board
the vessel at the port of shipment.
CFR (Cost and Freight)
The seller clears the goods for export and delivers them when they are on board
the vessel at the port of origin. The seller shoulders the cost of freight to
the named port of destination. The buyer assumes all the risks for the goods from
the point the goods have been delivered on board the vessel at the port of origin.
FAS (Free Alongside Ship)
The seller clears the goods for export and delivers them when they are placed next to
the vessel at the named port of origin. The buyer bears all risks and costs for goods from this point onwards.
FOB (Free on Board)
The seller clears the goods for export and delivers them when they are on board the vessel at the named port of origin. The buyer bears all risks and costs for goods from this moment onwards.
