INCOTERMS: (international commercial terms, international terms of commerce) are terms, of three letters each, that reflect the norms of voluntary acceptance by the two parties , about the conditions of delivery of the goods and or products. They are used to clarify the costs of international commercial transactions, delimiting the responsibilities between the buyer and the seller, and reflect current practice in the international transport of goods.
The Convention on Contracts for the International Sale of Goods of the United Nations (in English, CISG, UN Convention on Contracts for the International Sale of Goods) «Sale of Goods describes the moment in which the risk on the merchandise is transferred from the seller (manufacturer or not) to the buyer (be it the end user or not), but recognizes that, in practice, most international transactions are governed according to the obligations reflected in the incoterms.
The ICC (International Chamber of Commerce or ICC: International Chamber of Commerce) has been in charge since 1936 (with revisions in 1945, 1953, 1967, 1976, 1980, 1990, 2000 and 2010) of the elaboration and updating of these terms, of according to the changes that international trade is experiencing. Currently Incoterms 2010 (as of January 1, 2011) are in effect, without this meaning that the previous ones have ceased to be used. Hence, the need to point out the Incoterm and the year of the version.
Ex Works (named place) ? in factory (agreed place).
The seller puts goods at the disposal of the buyer in their own facilities: factory, warehouse, etc. All the expenses from that moment on are paid by the buyer.
The EXW incoterm can be used with any type of transport or with a combination of them (known as multimodal transport). That is to say, the supplier is in charge of the logistics and the necessary transfer so that the buyer has the supply of the product in the same place where he performs the productive task. This Incoterm was not modified in relation to Incoterms year 2000.
Free Alongside Ship (named loading port) ? Free alongside the vessel (agreed loading port).
-The seller delivers the goods in the agreed dock of the cargo port agreed; that is, next to the ship. The FAS incoterm is typical of bulk cargo or bulky cargo because it is deposited in specialized port terminals, which are located on the dock.
The seller is responsible for the procedures and costs of the customs office of export (in the versions prior to Incoterms 2000, the buyer organized the customs clearance for export).
Free On Board (named loading port) ? Free on board (agreed port of loading)
The seller delivers the goods on the ship. The buyer is responsible for designating and reserving the main transport (ship)
The incoterm FOB is one of the most used in international trade. It must be used for general cargo (drums, coils, containers, etc.) of merchandise, not usable for bulk.
Free Carrier (named place) ? Free carrier (agreed place).
The seller agrees to deliver the goods at a point agreed within the country of origin, which can be the premises of a freight forwarder, a railway station … (this place agreed to deliver the goods is usually related to the spaces of the carrier) . It takes care of the costs until the merchandise is located at that agreed point.
The incoterm FC can be used with any type of transport: air, rail, road and container transport / multimodal transport.
Cost and Freight (named destination port) ? cost and freight (port of agreed destination).
The seller is responsible for all costs, including the main transport, until the goods reach the port of destination. However, the risk is transferred to the buyer at the moment the merchandise is loaded on the ship, in the country of origin. It should be used for general cargo, which is transported in containers; It is NOT appropriate for bulk.
The CFR incoterm is only used for transport by ship, either sea or river.
Carriage Paid To (named place of destination) ? transport paid to (agreed place of destination).
The seller is responsible for all costs, including the main transport, until the goods reach the agreed point in the country of destination. However, the risk is transferred to the buyer at the time of delivery.
The CPT incoterm can be used with any mode of transport.
Carriage and Insurance Paid (To) (named place of destination) ? «transport and insurance paid up to (place of agreed destination)».
The seller is responsible for all costs, including the main transport and insurance, until the goods reach the agreed point in the country of destination.
The CIP incoterm (multimodal transport).
Delivered At Terminal (named port) ? delivered to terminal (named port of destination)».
The DAT incoterm is used for all types of transport. It is one of the two new Incoterms 2010 with DAP and replaces the incoterm DEQ.
The seller is responsible for all costs, including main transport and insurance (which is not mandatory)
Delivered At Place (named destination place) ? delivered at a point (named place of destination).
The Incoterm DAP is used for all types of transport. It is one of the two new Incoterms 2010 with DAT. Replaces the Incoterms DAF, DDU and DES. Delivered Duty Paid (named destination place) ? delivered with paid rights (named place of destination)».
