Incoterms
Cost and freight is a legal term used in contracts for international trade that specifies that the seller of the goods is required to arrange for the carriage of goods by sea to a port of destination and provide the buyer with the documents necessary to obtain the items from the carrier. Risk transfers to buyer when the goods have been loaded on board the vessel in the country of export.
This refers to an Incoterm meaning the buyer assumes all risk once the goods are onboard the vessel for the main carriage but does not assume costs until the freight arrives at the named port of destination. CIF applies to ocean or inland waterway transport only. It is commonly used for bulk cargo, oversized or overweight shipments.
Carriage and Insurance Paid To (CIP) means that the seller delivers the goods to the carrier or to another person specified by the seller at an agreed location (if that location is agreed between the parties) and that the seller is obliged to conclude the carriage contract and pay the freight costs incurred for the delivery of the goods.
Carriage Paid To (CPT) is an international trade term that means the seller delivers the goods at their expense to a carrier or another person nominated by the seller. The seller assumes all risks, including loss, until the goods are in the care of the nominated party.
DAP means the seller is responsible for the costs of packing goods as well as for arranging the delivery of the goods to the named place agreed with the buyer. It can be used for any transport mode, or where there is more than one transport mode. The seller is responsible for arranging carriage.
Delivered At Terminal refers to the seller delivering the goods, once unloaded from the arriving means of transport. Goods are placed at the disposal of the buyer at the named terminal, at the named port or place of destination.
DAT can be used for any transport mode, or where there is more than one transport mode. The seller is responsible for arranging carriage and for delivering the goods
Delivered duty paid means that the seller fulfils his obligation to deliver when the goods have been made available at the named place in the country of importation. The seller must bear the risks and costs, including duties, taxes and other charges of delivering the goods thereto, cleared for importation.
Ex works (EXW) is an international trade term that describes when a seller makes a product available at a designated location, and the buyer of the product must cover the transport costs. This term places the maximum obligation on the buyer and minimum obligations on the seller.
Free Carrier (named place of origin) The seller delivers the goods, cleared for export, at a named place (possibly including the seller’s own premises). The goods can be delivered to a carrier nominated by the buyer, or to another party nominated by the buyer.
Free on Board (FOB) is a shipment term used to indicate whether the seller or the buyer is liable for goods that are damaged or destroyed during shipping. “FOB shipping point” or “FOB origin” means the buyer is at risk and takes ownership of goods once the seller ships the product.
Incoterms 2020
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