WHAT ARE INCOTERMS? 2024

What are Incoterms? – Incoterms, a set of rules established by the International Chamber of Commerce for terms used in foreign trade, define the transfer of responsibility between importers and exporters at each stage of delivery. Incoterms have been one of the most searched topics online in recent years. So what are Incoterms? Where and how are they used? Here are the details…

WHAT ARE INCOTERMS? WHERE ARE THEY USED?

Incoterms help reduce the complexity of international trade and prevent disputes. They consist of 11 different rules, each specifying a different level of delivery responsibility. The rules specify the point at which goods pass from the seller’s responsibility to the buyer’s. Incoterms rules also determine who bears other costs, such as responsibility for paying customs duties, and they protect the rights of the parties in the event of a dispute.

WHAT ARE THE INCOTERMS TERMS AND ABBREVIATIONS?

Incoterms are of great importance in foreign trade. At Talos Logistics, we have compiled some Incoterms, their meanings and abbreviations for you.

DELIVERY AT THE FACTORY

Ex Works (EXW): The seller delivers the goods it produces to the buyer at its own factory. The buyer is responsible for customs procedures and transporting the goods. 

DELIVERY TO THE CARRIER

Free Carrier (FCA): The seller delivers the goods it produces to the carrier appointed by the buyer. From this point, responsibility lies with the buyer.

CARRIAGE PAID

Carriage Paid To (CPT): The seller transports its goods to the place designated by the buyer. The buyer is responsible for transporting the goods and for customs procedures.

CARRIAGE AND INSURANCE PAID

Carriage and Insurance Paid To (CIP): The goods produced by the seller are transported to the point designated by the buyer. The transport and insurance costs are paid by the seller. The buyer is responsible for customs procedures.

DELIVERY AT THE NAMED PLACE

Delivered at Place (DAP): The seller transports the goods to the place designated by the buyer. The buyer is responsible for clearing the goods through customs.

DELIVERY WITH DUTY PAID

Delivered Duty Paid (DDP): The seller transports the goods to a place designated by the buyer, ensures that they reach that place and pays the customs duties. The buyer is responsible for unloading the goods.

Things to consider when choosing Incoterms:

When choosing Incoterms, it is important to consider factors such as the type of goods, mode of transport, costs and risk. Choosing the right Incoterms can help your international trade transactions run smoothly. It is important to choose an expert, experienced company for this. With its customer-focused service approach, Talos Logistics continues to support you in every situation. To get a quote, CLICK HERE.

WOULD YOU LIKE TO BROWSE OUR GLOSSARY OF LOGISTICS TERMS? CLICK HERE