INCOTERMS

There are four categories of Incoterms

Origin Terms

Ex-works

Is intended to be used when the buyer is going to take responsibility for loading the goods onto a carrier selected by the buyer without assistance from the seller. If the seller is going to load the goods on the carriers selected and contracted by the buyer, the FCA LOADED should be used.
Mode of Transportation: Ex-Works can be used for any transportation mode.

International Transportation Not Paid by the Seller

FCA (Free Carrier, Loaded)

Goods loaded on the Buyer's Carrier by the Seller, at the Seller's premises or other place of Origin.Buyer is responsible for Inland Transport from the named place. When associated with a place of origin,should only be used when the responsibilities of the seller are limited to loading a carrier provided by thebuyer, at the seller's dock. Also,that the buyer is going to take responsibility for transportation once thegoods are loaded at the seller's dock.
Mode of Transportation: Any Mode of Transport

FCA (Free Carrier, Not UnLoaded)

Seller is resposible for loading the goods on the seller's carrier. The seller is responsible for InlandTransport from the place of origin to a Named Place. Seller makes goods available to the buyer,Not Unloaded from the seller's carrier.Should only be used when the goods are made availableto the buyer at the dock of the carrier chosen by the buyer, or other named place in the countryof origin requested by the buyer.
Mode of Transportation: Free Carrier can be use for any mode of transportation.

FAS (Free Alongside Ship)

Seller is responsible for Inland Transport from the place of origen to the Named Port of Export.Seller makes goods available to the buyer, once the goods are placed within the reach of theship's tackle. Requires the buyer to notify the seller of the arrangements for international transportationand the date and place of delivery. This requires the buyer to have established a relationship with a carrier,forwarder or agent at the ocean port of loading.The seller is responsible for all costs and transport, untilgoods are placed alongside the vessel. The term FAS should only be used when the buyer is going to takeresponsibility for international transportation once the goods have been received by the carrier and areplaced within the reach of the ship's tackle.
Mode of Transportation: is intended to be used only for ocean freight shipments.(Port to Port)

FOB (Free On Board Ocean Vessel)

Seller is responsible for Inland Transport from the place of origin to the Named Port of Export.Seller makes goods available to the buyer when goods are loaded on board the vessel.Is intendedfor use when it is important that the goods pass the ship's rail to evidence delivery. This term ismost commonly used for bulk cargo and port to port shipments of goods not loaded in an oceancontainer.
Mode of Transportation: is intended to be used only for ocean freight shipments where it is importantthat the goods pass the ship's rail. Goods shipped in an ocean container are more appropriately shippedunder FCA terms.

International Transportation PAID by Seller

CFR (Cost and Freight)

Seller is resposible for placing the goods on board an ocean vessel and paying for internationaltransport to the port of destination.Is intended for use in shipping ocean freight pier to pier cargothat is not containerized, when it is important that the goods pass the ship's rail to evidencedelivery, and the seller is contracting and paying for international carriage.Specifically, it wouldnot be an appropriate term to use when the goods have been loaded into an ocean container.As a result, this term is usually limited to oversized goods that cannot be loaded into a container,overweight shipments that would exceed the weight limitations of shipping in a container, or lessthan container load shipments.
Mode of Transportation: is intended to be use only for ocean freight shipments that are not loadedin an ocean container.

CIF (Cost, Insurance and Freight)

The seller is responsible for placing the goods on board an ocean vessel. Seller must pay forinternational transport and insurance to the port of destination.Is intended for use in shippingPier to Pier Ocean cargo that is not containerized, when it is important that the goods pass theship's rail to evidence delivery, and the seller is contracting for insurance and carriage.The insurance purchased is to be for a minimun amount of coverage, once the goods are loadedon the ocean vessel, and is to include insurance coverage to cover the buyer's insurable intereststo the port of destination stated on the bill of lading.The insurance is to cover 110% of the CFRvalue of the goods.
Mode of Transportation: is intended to be used only for ocean freight shipments that are not loadedin an ocean container.

CPT (Carriage Paid To)

Seller is responsible for placing the goods on an Air or Ocean Carrier (Containerized, Roll-On,Roll Off)at the port of export. Seller must pay for international transport to the named place of destination.Is intended for use in shipping by air freight, and ocean shipments that are containerized or can berolled on and off the vessel. this term is also used for multimodal ocean shipments. The philosophy in theuse of this term is that it is not important that the goods pass the ship's rail to evidence delivery, andthe seller is contracting and paying for international carriage to a named place in a foreign country.Also, the term CPT allows for the seller to arrange and pay for transportation from a named place atorigin (which could be the seller's dock) to a named place or destination in a foreign country.
Mode of Transportation: is intended to be use for air freight, containerized ocean freight androll-on-roll-off ocean freight shipments.

CIP (Carriage and Insurance Paid To)

Seller is responsible for placing the goods on an Air or Ocean Carrier (Containerized Roll-On,Roll Off cargo)at the port of export. Seller must pay for international transport and insurance to the named place ofdestination.
Mode of Transportation: is intended to be used for air freight, containerized ocean freight androll-on-roll-off ocean freight shipments.

Delivered at Named Port or Named Place at Destination

DAF (Delivered At Frontier, By Land)

Seller is reponsible for transporting the goods, by any mode, except that delivery to the named placeat the frontier must be made by surface transportation, not unloaded. Intends that the goods bedelivered at a frontier or border of a given country, by land.This can apply to the border of the countryof the seller, or at the border of any country where the buyer will take responsibility for customs clearanceand further transportation. The only difference is the extent to which the seller will need to contract fortransportation and incur costs in transiting other countries to arrive at the place designated by the buyer.If the term FCA can be applied to a given transaction, it is recommended that DAF not be used.
Mode of Transportation: Delivered at Frontier can be used for any mode of transportation, but deliverymust be made by land.

DES (Delivered Ex Ship)

The seller is responsible for the arrival of the goods at the named destination port. The buyer isresponsible for unloading the goods from the Ocean Vessel. Is intended for use in shipping goods byocean freight to a port designated by the buyer. Under this term, the seller is responsible for the arrival ofthe ship at the port of unloading. A further responsibility of the seller is that the goods must be available forunloading by the buyer at the designated port.
Mode of Transportation: is intended to be used for ocean freight shipments only.

DEQ (Delivered Ex Quay)

Seller is responsible for the arrival of the goods at the named destination port. The seller is also resposiblefor placing the goods on the Quay or Pier at the named destination port.Is intended for use in shippinggoods by ocean freight to a port designated by the buyer. Under the term DEQ, the seller is resposible forthe arrival and unloading of the goods from the ship at the port of unlaoding. While the DEQ term includesthe cost of unloading and any fees charged by the port relative to this service, the requirement forcustoms clearance has been eliminated from this term in the revisions effective january 1, 2000.
Mode of Transportation: Is intended to be used for ocean freight shipments only.

DDU (Delivered Duty Unpaid)

Is intended for use in shipping goods by any means of transport.The term DDU is most typically usedwhen the point of delivery is a place other than the port or airport of unloading for the internationaltransportation of the goods. The further transportation from the destination port can be included under theinternational bill of landing or a separate bill of landing issued upon arrival of the goods at the air or ocean port.
The seller is responsible for all transportation costs up to the destination designated by the buyer.The cost of customs formalities if the goods are transiting foreign countries is also for the account of the seller.
The buyer must pay all fees, duties and taxes incurred in the destination country relative to the clearance ofthe goods through cusstoms.
Mode of Transportation: is intended to be used for any mode of transportation.

DDP (Delivered Duty Paid)

Is intended for use in shipping goods by any means of transport to a named place. The term is most typicallyused when the point of delivery is a place other than the port or airport of unloading for the internationaltransportation of the goods. The further transportation from the destination port can be included under theinternational bill of landing or a separate bill of lading issued upon arrival of the goods at the air or ocean port.The seller is responsible for all transportation costs, customs formalities, duties, taxes and any other expensesnormally incurred in the course of transportation and customs clearance of goods entering the foreing country.
The seller is also responsible for obtaining any import permit or import license that may be required to satisfygovernmental or industry regulation for entering goods into the foreing country.
Mode of Transportation: is intended to be used for any mode of transportation.