Incoterms 2010 - Quick Reference Guide

Incoterms 2010

The INCOTERMS (International Commercial Terms) are a set of definitions of international trade terms, such as FOB, CFR and CIF, developed by the International Chamber of Commerce (ICC). It defines the trade contract responsibilities and liabilities between buyer and seller. The exporter and the importer need not undergo a lengthy negotiation about the conditions of each transaction. Once they have agreed on a commercial term like FOB, they can sell and buy at FOB without discussing who will be responsible for the freight, cargo insurance, and other costs and risks.

The INCOTERMS was first published in 1936---INCOTERMS 1936---and it is revised periodically to keep up with changes in the international trade needs. The complete definition of each term is available from the current publication---INCOTERMS 2010. The publication is available at your local Chamber of Commerce affiliated with the International Chamber of Commerce (ICC). Many importers and exporters worldwide are accustomed to and may still use the INCOTERMS 1980, the predecessor of INCOTERMS 1990 and INCOTERMS 2000.




Term Description Notes
EXW Ex-Works (Named Origin) Seller is only responsible for making the goods available at the seller’s premises. The buyer bears the full risk from there to the destination.
FCA Free Carrier (Named Origin or Port) Seller is responsible for delivery to the custody of the carrier, which is provided by the buyer. Risk is transferred as soon as loading has taken place.
CPT Carriage Paid to (Named Destination Port) Seller delivers the goods to the carrier at an agreed place of delivery and pays for transport to the named destination. Risk is transferred at the place of delivery, whereas seller pays for transport to the destination.
CIP Carriage & Insurance Paid to (Named Destination Port) Seller delivers the goods to the carrier at an agreed place of delivery and pays for transport and insurance to the named destination. Risk is transferred at the place of delivery, whereas seller pays for transport and insurance to the destination.
DAT Delivered At Terminal (Named Destination Terminal City) Seller delivers the goods unloaded at a specified place inside the agreed terminal. Risk is transferred as soon as the goods have been unloaded.
DAP Delivered At Place (Named Destination Door) Seller delivers the goods to the disposal of the buyer on the arriving means of transport at the agreed place. Seller assumes the risk until the goods are made ready for unloading from the arriving means of transport.
DDP Delivered Duty Paid (Named Destination Door) Seller is responsible for bringing the goods to the destination, paying any duty and making the goods available to the buyer. Risk is transferred as soon as the buyer has access to the goods ready for unloading at the agreed destination.
FAS Free Along Side (Named Port of Departure) Seller is responsible for delivery of the goods at the quay alongside the ship. From this point onwards, risk lies with the buyer.
FOB Free On Board (Named Origin or Port of Departure) Seller is responsible for delivery of the goods loaded on board the ship. Risk is transferred as soon as the goods have been set down inside the ship.
CFR Cost & Freight (Named Port of Entry) Seller covers cost of freight, duty unpaid, to the named port of destination. Risk is transferred as soon as the goods have been set down inside the ship.
CIF Cost, Insurance & Freight (Named Port of Entry) Seller covers cost of insurance and freight, duty unpaid, to the named port of destination. Risk is transferred as soon as the goods have been set down inside the ship.