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INCOTERMS 2000 & 2010
Incoterm Rules
Incoterms is a set of trade terms which define the responsibilities and risks of both buyer and seller on the sale/purchase of a commodity, including whilst in transit.
Below is a table listing the 13 Incoterms referred to within Incoterms 2000 and the 11 Incoterms referred to within Incoterms 2010, together with their meanings.
For particulars of buyers’ and sellers’ risks and responsibilities under each set of Incoterms, see the next table below.
Major differences between Incoterms 2000 and Incoterms 2010
- Two new Incoterms rules, DAT and DAP, have replaced Incoterms rules DAF, DES, DEQ and DDU.
- Incoterms 2010 apply in two separate situations: FAS, FOB, CFR and CIF apply only to sea and inland waterway transport, i.e. where the point of delivery and place to which they are carried are both ports. The remaining seven Incoterms rules may be applied irrespective of the mode of transport, including whether or not by ship.
- Reference to the ‘ship’s rail’ in FAS, FOB, CFR and CIF has been deleted in Incoterms 2010. Instead, goods are considered delivered when they are ‘on board’.
- In ‘string sales’ involving several sales of the same commodity, Incoterms 2010 include the obligation to ‘contract or procure a contract for the carriage of goods...’. Only the initial seller is obliged to ship the goods; it is sufficient for subsequent sellers to procure a contract to ship the goods.
The Terms and their Meanings
EXW
Ex-Works
The seller places the goods at the disposal of the buyer at the named place of delivery.
DAF
Delivered At Frontier (not in Incoterms 2010)
Delivery takes place at named place of destination, not unloaded, carriage paid by seller.
(Arrival at stated destination)
FCA
Free Carrier
Delivery at seller’s premises.
(International carriage NOT paid by seller)
DES
Delivered Ex-Ship (not in Incoterms 2010)
Delivery takes place at named port of destination, not unloaded, carriage paid by seller.
(Arrival at stated destination)
FAS
Free Alongside Ship
Delivery takes place alongside the nominated ship at the named port of shipment.
(International carriage NOT paid by seller)
DEQ
Delivered Ex-Quay (not in Incoterms 2010)
Delivery takes place at named port of destination, unloaded, not cleared.
(Arrival at stated destination)
FOB
Free on Board Vessel
Delivery takes place at the named port of shipment on board the nominated vessel.
(International carriage NOT paid by seller)
DDU
Delivered Duty Unpaid (not in Incoterms 2010)
Delivery takes place at named place of destination, not unloaded, not cleared, carriage paid by seller.
(Arrival at stated destination)
CFR
Cost and Freight
Delivery takes place on board the nominated vessel at the named port of shipment.
(International carriage paid by seller)
DDP
Delivered Duty Paid
Delivery takes place at named place of destination, not unloaded, cleared, carriage paid by seller.
(Arrival at stated destination)
CIF
Cost, Insurance and Freight
Delivery takes place on board the nominated vessel at the named port of shipment, insurance and carriage to destination paid by the seller.
(International carriage paid by seller)
DAT
Delivered At Terminal (Incoterms 2010 only)
CPT
Carriage Paid To
Delivery takes place at named place or port of destination.
(International carriage paid by seller)
DAP
Delivered At Place (Incoterms 2010 only)
CIP
Carriage and Insurance Paid To
Delivery takes place at the named place or port of destination, carriage and insurance paid by seller.
(International carriage paid by seller)
Risks and Responsibilities
This article is provided for information purposes only and is free of charge. Every reasonable effort is made to ensure the information is up-to-date at the original date of publication. The firm recommends seeking legal advice specific to any matter affecting the reader. For further information on this or other topics contact us.
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