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February, 2013Amman
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Presented by Caroline Gubbi
Incoterms 2010
Caroline is BDPs Regulatory Compliance Executive for Europe and has
been with BDP since September 2010.
Caroline is a 2010 graduate from the University of Antwerp with a
degree in Law and Maritime Science.
Caroline is a member of BDPs global Center of Excellence for
Regulatory Compliance.
Carolines duties cover a wide range of important issues, starting from
trade regulations, hazardous materials as well as security across
all modes.
Caroline is the European compliance resource and provides training
(internal & external) and assistance for the EU region on import
and export regulatory issues.
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Incoterms 2010
What Incoterms arentWhat Incoterms do
What Incoterms dont do
Important Changes for 2010
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Incoterms are:
Incoterms 2010
INternational COmmercial TERMS 11 terms of shipment and delivery created by the
,
contracts
Provide an Internationally accepted definit ion of:e respons es o uyer an e er
The allocation of delivery costs
The assumption of delivery risks
Periodically updated to reflect trade practice Should be referred to as Rules
Translated into different languages
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Incoterms 2010
Incoterms arent: Law Incoterms need to be specified in sales
con rac s n or er o app y.
This is normally done by citing the current Incoterms
version in sales quotations and purchase orders.
All-InclusiveDetailed situations beyond the
scope of Incoterms must be covered elsewhere
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Incoterms 2010
Divide costs, risks and responsibil itiesbetween seller and buyer
into subsidiary contracts necessary tofulf ill designated Incoterm tasks, such ascontracts of carriage and insurance
Provide useful shorthand
Reduce potential misunderstandingsbetween buyer and seller
Reflect rather than dictate tradepractice
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Incoterms 2010
Incoterms do not: Convey title
ress revenue recogn on
Include all of the duties of the Buyer/Seller in a
transaction
Automatically apply (you must specify)
Speak about payment disputes between buyer
and seller Deal with a breach in contracts
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Incoterms 2010
mportant c anges or :
11 terms of delivery instead of 13
DAF, DES, DDU and DEQ have been removed
DAP and DAT are new and have been added
Container arrival costs are not expressed (ex: THC and
other destination charges)
Exact cost transfer points need to be addressed
elsewhere in the contract
with unloading
FOB changed to on board vessel (ships rail reference
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Incoterms 2010
ANY MODE MARITIME ONLY
EXW FAS
FCA FOB
CPT CFR
CIP CIF
DAP
DDP
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Ex Works (EXW) E Terms
Sellers cost & risk end when
goods are at the disposal of
the Buyer at the Sellerse er s os
Sellers Risk(Warehouse Labor &
Export Packing)
Buyers Cost
Buyers Risk(Loading at Origin Point)
premises or named place.
EXW = ExWorks
(Named Place)
Buyers CostBuyers Risk(Port of Loading)
e er
Buyers Cost
Buyers Risk(In Transit)
Buyers Cost
Bu ers Risk
(Port of Discharge)
Buyer
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Incoterms 2010
erms
FREE CARRIERNAMED PLACE (usually the sellers
Premises or a buyer appointed carrier terminal on the
se er s s e
Abbreviation: FCA
Transport Mode: All oa ng: truc , tra n, arge at e er s ac ty s se er s respons ty
Pre- carriage is sellers responsibility
Sellers cost & risk end when goods are delivered to Buyers Carrier at the
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Free Carrier (FCA) F Terms
Sellers cost & risk end
when goods are
e er s osSellers Risk
(Named Place)
Sellers Cost
Sellers Risk(Named Place)
carrier.
FCA = Free Carrier
(Named Place)
uyer s ost
Buyers Risk(In Transit)
e er
Buyers Risk
Buyer
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Incoterms 2010
Abbreviation: FAS
Transport Mode: Vessel
oa ng: ruc , ra n , arge, e c. a e er s ac y s se er s respons y
Pre-carriage: Sellers responsibil ity
Sellers cost and risk end when goods are placed alongside the vessel
Suggestion: In case of containers delivered at a terminal, the FCA rule is
more appropriate
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Free Alongside Ship F Terms
Sellers cost & risk end
when goods are
delivered to buyers
Sellers Cost
Sellers Risk Sellers Cost
Sellers Risk
carrier
FAS = Free Alongside
Ship
(Named Port of
Buyers Cost
Buyers Risk
Shipment)
Loading)
Buyers Cost
Buyers Risk(In Transit)
Seller
Bu er
Buyers CostBuyers Risk
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Incoterms 2010
FREE ON BOARD NAMED PORT OF SHIPMENT Abbreviation: FOB
Loading: truck, train, barge, etc. at Sellers facility
is the Sellers responsibil ity
Pre-carria e: Sellers res onsibil it
Vessel loading: Sellers responsibili ty
Sellers cost and risk end when the goods are delivered on
board the vessel nominated b the bu er
Suggestion: For containerized shipments, consider FCA
showing the carriers terminal at the port as the designated
lace
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Free on Board (FOB)
*Ocean Only
F Terms
Sellers cost & risk end
when goods are
Sellers Cost
Sellers Risk(Named Place)
carrier
FOB = Free on Board
(Named Port of
Sellers Cost
Sellers Risk(On Board Ship/At
ort o oa ng)
Bu ers Cost
Buyers Risk(In Transit)
Buyers Cost
Buyers Risk
Seller
(Port of Discharge)
Buyers Cost
Buyers Risk
Buyer
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Incoterms 2010
ermsCOST AND FREIGHT NAMED PORT OF
DESTINATION
Abbreviation: CFR
Transport Mode: Vessel
Loading: truck, train, barge, etc. at Sellers facility is the Sellersresponsibility
Pre-carriage: Sellers responsibi lity
Vessel loading: Sellers responsibi lity
Main carriage: Sellers responsibi lity (however, Seller is notresponsible for condition of goods whi le they are in main carriage
transit)
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Incoterms 2010
COST AND FREIGHT NAMED PORT OF
DESTINATION (continue)
Sellers r isks for loss and damage end when the goods
are on board the vessel
The Seller must contract and pay the costs and freight necessaryto bring the goods to the named port of destination
Suggestions: for containerized shipments, consider CPT showing
the destination port or an inland location on the buyers side
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Cost & Freight
*
C Terms
Sellers assumes cost
but not risk of delivered
Sellers Cost
Sellers RiskSellers Cost
Sellers RiskPort of Loadin
destination
CFR = Cost & Freight
(Named Port of Destination)
e er s ost
Buyers Risk(In Transit)
Buyers CostBu ers Risk
Seller
(Port of Discharge)
Buyers Cost
Buyers Risk
Bu er
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Incoterms 2010
COST INSURANCE AND FREIGHTNAMED PORT OF
DESTINATION
Transport Mode: Vessel
Loading: truck, train, barge, etc. at Sellers facility is the Sellers
res onsibilit
Pre carriage: Sellers responsibil ity
Vessel loading: Sellers responsibili ty
The sellers risks of dama e or loss end when oods are on board the
vessel The seller must contract for and pay the costs and freight necessary to
bring the goods to the named port of destination
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Incoterms 2010
COST INSURANCE AND FREIGHTNAMED PORT OF
DESTINATION (continue)
on behalf of the buyer
Main carriage: the contract of main carriage and payment
Suggestion: for containerized shipments, consider CIP
showing the destination port or an inland location on the
.
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Incoterms 2010
CARRIAGE PAID TO NAMED PLACE OF
DESTINATION
Abbreviation: CPT
Transport mode: All
Loading: Sellers responsibil ity
Pre carriage: Sellers responsibi lity a n carr age: e er s respons y
Sellers risk ends when goods are delivered to the carrier or another
person nominated by the seller at an agreed place
Su estions: Ideal for containerized shi ments
The Seller must contract for the costs of carriage necessary to bring thegoods to the named place of destination
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CARRIAGE AND INSURANCE PAID TO
Incoterms 2010
NAMED PLACE OF DESTINATION
Abbreviation: CIP
Trans ort Mode: All
Loading: truck, train, barge at Sellers facility is Sellers
responsibility
Pre-carriage: Sellers responsibi lity
Insurance: Seller must provide buyer with insurance policy
Sellers risk ends when goods are delivered to the carrier or
another person nominated by the seller at an agreed place
The seller must contract for the costs of carriage necessary tobring the goods at the named place of destination
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Carriage & C Terms
Seller assumes cost but not
risk of delivering goods to
named destination
CIP = Carriage &Insurance Paid(Named Place of
Destination)
Sellers Cost
Sellers Risk(Into Custody of
arr er)
Sellers Cost
Buyers Risk
Seller(In Transit)
Buyers Cost
Buyers Risk(Port of Discharge)
Buyer
Buyers CostBuyers Risk
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Incoterms 2010
D TermsDELIVERED AT TERMINAL (terminal on Buyers side)
rev a on:
Transport mode: all
Sellers risks end once goods are unloaded from the arriving
named terminal at port or place of destination
The Seller must contract for the costs of carriage to the named
terminal at the a reed ort or lace of destination
Suggestion: when using this term it is recommended to specify asclearly as possible the terminal at the agreed port or place of
destination, as the risks to that point are for the account of the
e er
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Delivered At D Terms
Seller bears costs and
risks of delivery of goods
to Buyers
Sellers Cost
Sellers RiskSellers Cost
Sellers Risk(Into Custody of
country/location.
DAT= Delivered At
Terminal(Named Port /Place of
arr er)
Sellers Cost
Sellers Risk
Seller(In Transit)
Sellers Cost
Sellers Risk(Port of Discharge)
Buyer
Buyers CostBuyers Risk
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Incoterms 2010
DELIVERED AT PLACE ( on Buyers side)
Abbreviation: DAP
Trans ort mode: al l
The sellers risks end when goods are placed at the disposal of
the buyer on the arriving means of transport ready for unloading
The Seller bears the costs for the carriage of the goods to thenamed place of destination or the agreed place
Suggestion: when using this term, make clear which party is
responsible for unloading and any type of on-carriage
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Delivered At Place D Terms
Seller bears cost and
risks of delivery of goods
Sellers Cost
Sellers RiskSellers Cost
Sellers RiskInto Custod of
country/location
DAP = Delivered At
PlaceNamed Place of
Carrier)
Sellers Cost
Destination)
Seller
(In Transit)
Sellers Cost
Sellers Risk(Port of Discharge)
Buyer
Buyers Cost
Buyers Risk
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Incoterms 2010
Abbreviation: DDP Transport mode: All
all the costs and risks involved in bringing the goods to the place of
destination and
import,
And has to pay any duty for both export and import and
Has to carr out all customs formalities
The seller wi ll also need to bear the VAT !
D T
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DeliverDuty Paid D Terms
Seller bears costs and
risks of delivery of goods
Sellers Cost
Sellers RiskSellers Cost
Sellers Risk
country/location.
DDP= Delivered Duty
PaidNamed Place of
Sellers Cost
Destination)
Seller
(Port of Loading)
Sellers Cost
Sellers Risk(Named Place of Distribution)
u er
Sellers CostSellers Risk
(Duty Sellers Cost)
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