INCOTERMS 2020: Guide to International Trade Terms

Understand INCOTERMS rules and optimize your trade operations

INCOTERMS (International Commercial Terms) are standardized rules that define the rights and obligations of buyers and sellers in international trade. Developed by the International Chamber of Commerce (ICC), these rules clarify the distribution of shipping costs, risks, and responsibilities.

Most Commonly Used INCOTERMS Rules

EXW (Ex Works)

The seller makes the goods available at their premises. All transportation, insurance, and customs costs are the buyer's responsibility. This is the rule with the most responsibility for the buyer.

FOB (Free On Board)

The seller loads the goods onto the vessel at the port of shipment. From this point, risks and costs transfer to the buyer. This is the most commonly used rule in sea freight.

CIF (Cost, Insurance and Freight)

The seller pays transportation and insurance costs to the destination port. However, risk transfers to the buyer once the goods are loaded onto the vessel at the port of shipment.

DDP (Delivered Duty Paid)

The seller pays all costs, including customs duties, and delivers the goods to the buyer's address. This is the most convenient rule for the buyer.

How to Choose the Right INCOTERMS?

INCOTERMS selection depends on many factors: transport mode, risk tolerance, customs experience, and financial capabilities. The 166 Global Logistics team helps you choose the most suitable INCOTERMS rules.

The right INCOTERMS choice reduces costs and minimizes risks in your trade operations. Contact us for professional advice!