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Presented By:
Nakul Khatri
INCOTERMS 2000
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First published by the ICC in 1936
ICC (International Chamber of Commerce) Official
Rules for the Interpretation of Trade terms.
Purpose is to provide a set of international rules forthe interpretation of the most commonly used tradeterms.
10 categories describing where risks lie betweenseller and buyer
International Commercial Terms (INCOTERMS)
INCOTERMS 2000
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The E-term is the term in which the sellers obligation
is at its minimum.
Incoterms 2000
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Carriage to be arranged by the BUYER
Risk is transferred from SELLER to BUYER as the goods
leave the factory premises
Entire cost is to be incurred by BUYER
EXW
EX WORKS (named place)
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EXWEx Works (named place)
SELLER BUYER
Seller/
ExporterPremises
Export
DocumentsFormalities
Delivered
at namedplace of:
Frontier/
Terminal/
Quay
Loading
Port ofShipment
Onboard
ShipRail
Plane
Ships Ships
Rail Rail
Discharging
Port ofArrival
Delivery at
named place ofdestination:
Frontier/
Terminal/Quay
Import
DocumentsFormalities
Buyer/
ImporterPremises
Sellers
Risks
Buyers Risks
Sellers
Cost
Buyers Cost
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The F terms require the seller to delivergoods for carriage as instructed by the buyer.
FCA
FAS
FOB
Incoterms 2000
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Seller delivers when goods, cleared forexport, to the carrier nominated by the buyer
at a named place.Term may be used irrespective of the mode
of transport.
Seller obligated to load goods on arrivingvehicle if it arrives at the sellers premises.
Seller not obliged to unload goods from hisvehicle.
FCA
FREE CARRIER (named place)
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FCAFree Carrier(named place)
SELLER BUYER
Seller/
Exporter
Premises
Export
Documents
Formalities
Delivered
at named
place of:
Frontier/
Terminal/
Quay
Loading
Port of
Shipment
Onboard
Ship
Rail
Plane
Ships Ships
Rail Rail
Discharging
Port of
Arrival
Delivery at
named place of
destination:
Frontier/
Terminal/Quay
Import
Documents
Formalities
Buyer/
Importer
Premises
Sellers Risks Buyers
Risks
SellersCost Buyers Cost
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Seller delivers when goods, cleared for export,are placed alongside the vessel
Seller obliged to clear goods for export.
The buyer bears all costs and risks of loss ordamage to the goods from that moment.
Terms can be used for sea or inland waterwaytransport only.
FAS -FREE ALONGSIDE SHIP
(named port of shipment)
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FASFree Alongside(named place)
SELLER BUYER
Seller/
ExporterPremises
Export
DocumentsFormalities
Delivered
at namedplace of:
Frontier/
Terminal/
Quay
Loading
Port ofShipment
Onboard
ShipRail
Plane
Ships Ships
Rail Rail
Discharging
Port ofArrival
Delivery at
named place ofdestination:
Frontier/
Terminal/Quay
Import
DocumentsFormalities
Buyer/
ImporterPremises
Sellers Risks Buyers
Risks
SellersCost Buyers Cost
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Seller delivers when goods, cleared forexport, pass the ships rail at the named port
of shipment.The buyer bears all costs and risks of loss or
damage to the goods from that point.
Term can be used for sea or inland waterwaytransport only.
If intent is not to deliver goods across theships rail, use FCA
FOB FREE ON BOARD
(named port of shipment)
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FOBFree On Board(named port of shipment)
SELLER BUYER
Seller/
Exporter
Premises
Export
Documents
Formalities
Delivered
at named
place of:
Frontier/
Terminal/
Quay
Loading
Port of
Shipment
Onboard
Ship
Rail
Plane
Ships Ships
Rail Rail
Discharging
Port of
Arrival
Delivery at
named place of
destination:
Frontier/
Terminal/Quay
Import
Documents
Formalities
Buyer/
Importer
Premises
Sellers Risks Buyers
Risks
SellersCost Buyers Cost
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The C terms require the seller to contract forcarriage at his expense to a specified point.
CFRCIF
CPT
CIP
Incoterms 2000
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Seller delivers when goods, cleared for export,
pass the ships rail at the named port of
shipment.The seller pays the costs and freight necessary tobring goods to port of destination, but the buyerbears the risk of loss and additional costsoccurring after delivery.
Term can be used for sea or inland waterwaytransport. If intent is not to deliver goods across the ships
rail, use CPT
CFR COST AND FREIGHT
(named port of destination)
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CFRCost and Freight (named port of destination)
SELLER BUYER
Seller/Exporter
Premises
ExportDocuments
Formalities
Deliveredat named
place of:
Frontier/
Terminal/
Quay
LoadingPort of
Shipment
OnboardShip
Rail
Plane
Ships Ships
Rail Rail
DischargingPort of
Arrival
Delivery atnamed place of
destination:
Frontier/
Terminal/Quay
ImportDocuments
Formalities
Buyer/Importer
Premises
Sellers Risks Buyers Risks
Sellers Cost Buyers Cost
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Seller delivers when goods, cleared for export, pass the
ships rail at the named port of shipment.
The seller pays the costs and freight necessary to bringgoods to port of destination, but the buyer bears the riskof loss and additional costs occurring after delivery.
The seller procures marine insurance, against buyersrisk of loss. Seller is required to obtain insurance onlyon minimum cover.
Term can be used for sea or inland waterway transport.
If intent is not to deliver goods across the ships rail, useCIP.
CIF COST, INSURANCE AND
FREIGHT(named port of destination)
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CIFCost, Insurance and Freight (named port of destination)
SELLER BUYER
Seller/Exporter
Premises
ExportDocuments
Formalities
Deliveredat named
place of:
Frontier/
Terminal/
Quay
LoadingPort of
Shipment
OnboardShip
Rail
Plane
Ships Ships
Rail Rail
DischargingPort of
Arrival
Delivery atnamed place of
destination:
Frontier/
Terminal/Quay
ImportDocuments
Formalities
Buyer/Importer
Premises
Sellers
RisksBuyers Risks
SellersCosts
Buyers Cost
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Seller delivers the goods, cleared for export,to the carrier.
The seller pays the costs of carriage necessaryto bring goods to named destination, but thebuyer bears the risk of loss and additional
costs occurring after delivery.Term may be used irrespective of mode of
transport.
CPT CARRIAGE PAID TO
(named place of destination)
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CPTCarriage Paid To (named port of destination)
SELLER BUYER
Seller/
Exporter
Premises
Export
Documents
Formalities
Delivered
at named
place of:
Frontier/
Terminal/
Quay
Loading
Port of
Shipment
Onboard
Ship
Rail
Plane
Ships Ships
Rail Rail
Discharging
Port of
Arrival
Delivery at
named place of
destination:
Frontier/
Terminal/Quay
Import
Documents
Formalities
Buyer/
Importer
Premises
Sellers Risks Buyers
Risks
Sellers Cost Buyers
Costs
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Seller delivers the goods, cleared for export, the thecarrier.
The seller pays the costs of carriage to nameddestination, but the buyer bears the risk of loss andadditional costs occurring after delivery.
The seller procures insurance against buyers risk of
loss. Seller is required to obtain insurance only on aminimum cover.
Term may be used irrespective of mode of transport.
CIP CARRIAGE AND INSURANCE PAIDTO (named place of destination)
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CIPCarriage and Insurance Paid To (named port of destination)
SELLER BUYER
Seller/
ExporterPremises
Export
DocumentsFormalities
Delivered
at namedplace of:Frontier/Terminal/
Quay
Loading
Port ofShipment
Onboard
ShipRail
PlaneShips ShipsRail Rail
Discharging
Port ofArrival
Delivery at
named place ofdestination:
Frontier/Terminal/Quay
Import
DocumentsFormalities
Buyer/
ImporterPremises
Sellers Risks Buyers Risks
Sellers Cost Buyers Cost
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The D terms require the seller to take thegoods all the way to destination at the border
or within the country of import.DAF
DES
DEQDDU
DDP
Incoterms 2000
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Seller delivers goods to the buyer, not cleared forimport, and not unloaded, at the named place of
destination. Seller bears all costs and risks (except duty) to bring
goods to the named place of destination.
Term may be used irrespective of mode of transport.
If delivery is to take place at the port, quay or onboard a vessel, DES or DEQ should be used.
DDU DELIVERED DUTY UNPAID(named place of destination)
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DDUDelivered Duty Unpaid(named place of destination)
SELLER BUYER
Seller/
Exporter
Premises
Export
Documents
Formalities
Delivered
at named
place of:
Frontier/
Terminal/
Quay
Loading
Port of
Shipment
Onboard
Ship
Rail
Plane
Ships Ships
Rail Rail
Discharging
Port of
Arrival
Delivery at
named place of
destination:
Frontier/
Terminal/Quay
Import
Documents
Formalities
Buyer/
Importer
Premises
Sellers Risks Buyers
Risks
SellersCost Buyers Cost
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Seller delivers goods to the buyer, cleared for import,and not unloaded, at the named place of destination.
Seller bears all costs and risks, including importduty, to bring goods to the named place ofdestination.
Term may be used irrespective of mode of transport.
If delivery is to take place at the port, quay or onboard a vessel, DES or DEQ should be used.
DDP DELIVERED DUTY PAID(named place of destination)
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DDPDelivered Duty Paid(named place of destination)
SELLER BUYER
Seller/
ExporterPremises
Export
DocumentsFormalities
Delivered
at namedplace of:
Frontier/
Terminal/
Quay
Loading
Port ofShipment
Onboard
ShipRail
Plane
Ships Ships
Rail Rail
Discharging
Port ofArrival
Delivery at
named place ofdestination:
Frontier/
Terminal/Quay
Import
DocumentsFormalities
Buyer/
ImporterPremises
Sellers Risks Buyers
Risks
SellersCost Buyers Cost
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Seller delivers goods, cleared for export, at disposal of
buyer on arriving means of transport.
Not unloaded, not cleared for import at point at frontierbefore customs border of adjoining country.
Term may be used irrespective of the mode of transportwhen goods are delivered at a land frontier.
If delivery is to take place in the port of destination, DESor DEQ should be used.
DAF DELIVERED AT FRONTIER(named place)
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DAFDelivered At Frontier(named place)
SELLER BUYER
Seller/
ExporterPremises
Export
DocumentsFormalities
Delivered
at namedplace of:
Frontier/
Terminal/
Quay
Loading
Port ofShipment
Onboard
ShipRail
Plane
Ships Ships
Rail Rail
Discharging
Port ofArrival
Delivery at
named place ofdestination:
Frontier/
Terminal/Quay
Import
DocumentsFormalities
Buyer/
ImporterPremises
Sellers Risks Buyers
Risks
SellersCost Buyers Cost
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Seller delivers goods at disposal of buyer on boardthe ship.
Not cleared for import at the named port ofdestination.
Seller bears all costs and risks to bring goods to thenamed port before discharging.
Term used only for delivery by sea. If the seller is to bear the costs of discharging the
goods, DEQ should be used.
DES DELIVERED EX SHIP(named port of destination)
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DESDelivered exShip(named port of destination)
SELLER BUYER
Seller/
ExporterPremises
Export
DocumentsFormalities
Delivered
at namedplace of:
Frontier/
Terminal/
Quay
Loading
Port ofShipment
Onboard
ShipRail
Plane
Ships Ships
Rail Rail
Discharging
Port ofArrival
Delivery at
named place ofdestination:
Frontier/
Terminal/Quay
Import
DocumentsFormalities
Buyer/
ImporterPremises
Sellers Risks Buyers
Risks
SellersCost Buyers Cost
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Seller delivers goods, not cleared for import, atdisposal of buyer on the quay at the named port of
destination. Seller bears all costs and risks to bring goods to the
named port of destination and discharging the goodson the quay.
Term used only for delivery by sea.
DEQ DELIVERED EX QUAY(named port of destination)
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DEQDelivered Ex Quay(named port of destination)
SELLER BUYER
Seller/
ExporterPremises
Export
DocumentsFormalities
Delivered
at namedplace of:
Frontier/
Terminal/
Quay
Loading
Port ofShipment
Onboard
ShipRail
Plane
Ships Ships
Rail Rail
Discharging
Port ofArrival
Delivery at
named place ofdestination:
Frontier/
Terminal/Quay
Import
DocumentsFormalities
Buyer/
ImporterPremises
Sellers Risks Buyers
Risks
SellersCost Buyers Cost
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INCOTERMS 2010
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There will now be a total of 11 terms instead of 13,
New additions (TWO) : DAP and DATDeletions (FOUR) : DAF, DDU, DEQ and DES
INCOTERMS 2010
EXW: Ex works
FCA : Free carrierCPT : Carriage Paid toCIP : Carriage andInsurance paid toDAT : Delivered AtTerminalDAP : Delivered At Place
DDP : Delivered Duty Paid
FAS : Free Alongside ShipFOB : Free On BoardCFR : Cost And FreightCIF : Cost, Insurance andFreight
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INCOTERMS 2010
EXW : Ex worksFCA : Free carrierCPT : Carriage Paid to
CIP : Carriage andInsurance paid toDAT : Delivered AtTerminalDAP : Delivered At PlaceDDP : Delivered Duty Paid
FAS : Free Alongside ShipFOB : Free On BoardCFR : Cost And FreightCIF : Cost, Insurance andFreight
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