Incoterms (International Commercial Terms) are a set of globally recognized commercial terms established by the International Chamber of Commerce (ICC). These terms define the responsibilities of buyers and sellers in international transactions, helping to reduce confusion caused by differing interpretations across countries. They are commonly used in sales contracts worldwide.

While the Incoterms listed here are standard for this platform, sellers and buyers can always agree to adjust the terms during order processing if a different Incoterm better suits their specific transaction.

EXW: Ex Works

Seller's Responsibility: Minimum
Buyer’s Responsibility: Maximum

The seller only needs to make the goods available at their premises (e.g., factory or depot), with suitable packaging. The buyer is responsible for loading the goods, export procedures, onward transport, and all costs after collection.

Note: In many cross-border deals, the exporter still needs to participate in export clearance. For practical reasons, you may prefer using FCA (Free Carrier).

FCA: Free Carrier

Seller’s Responsibility: Moderate
Buyer’s Responsibility: From loading onward

The seller is responsible for delivering the goods, cleared for export, to a named location (e.g., transport hub or forwarder’s warehouse). Risk transfers to the buyer when the goods are handed over to the carrier at the agreed location. If the named place is the seller’s premises, the seller must also load the goods onto the transport vehicle.

Recommended: For containerized goods where the buyer arranges the main carriage.

CPT: Carriage Paid To

Seller’s Responsibility: Up to the main carrier
Buyer’s Responsibility: After the goods reach the carrier

The seller arranges and pays for transport to a named destination, but risk transfers to the buyer once the goods are handed over to the carrier.

CIP: Carriage and Insurance Paid To

Seller’s Responsibility: Includes transport and insurance
Buyer’s Responsibility: After goods reach the carrier

This is similar to CPT, but the seller must also insure the goods during transit. The insurance must cover 110% of the contract value, typically under the Institute Cargo Clauses (C). The insurance policy must be in the contract's currency and allow all interested parties to claim.

DAT: Delivered At Terminal

Seller’s Responsibility: Until goods are unloaded at terminal
Buyer’s Responsibility: From terminal onward

The seller handles all transport costs, export fees, and unloading at the destination terminal. The buyer is responsible for import clearance and any local taxes.

Tip: Ensure the terminal is specified precisely, as large transport hubs may cause confusion.

DAP: Delivered At Place

Seller’s Responsibility: Until goods are ready for unloading at the destination
Buyer’s Responsibility: Unloading and beyond

The seller delivers the goods to the named destination. Risk transfers to the buyer when the goods arrive on the transport vehicle, ready for unloading.

DDP: Delivered Duty Paid

Seller’s Responsibility: Maximum, includes duties and taxes
Buyer’s Responsibility: Unloading

The seller is responsible for all costs, including import duties, taxes, and transport to the buyer’s location. The buyer is only responsible for unloading the goods. This term is often used instead of "Free In Store (FIS)."

FAS: Free Alongside Ship

Seller’s Responsibility: Up to the port of loading
Buyer’s Responsibility: From the port onward

The seller must place the goods alongside the buyer’s vessel at the port of shipment. The buyer is responsible for all costs and risks once the goods are alongside the ship. This term is best for non-containerized sea freight.

FOB: Free on Board

Seller’s Responsibility: Up to loading the goods on the ship
Buyer’s Responsibility: After goods are loaded

The seller delivers the goods on board the buyer's designated vessel. The buyer covers costs from this point, including marine freight, insurance, and delivery to the final destination. Use FOB only for non-containerized sea freight to avoid contractual risks.

CFR: Cost and Freight

Seller’s Responsibility: Freight costs to the destination port
Buyer’s Responsibility: Risk after goods are loaded

The seller covers freight to the named destination port but risk transfers to the buyer when the goods are loaded onto the vessel. If insurance is required, use CIF instead. CFR is only suitable for non-containerized sea freight.

CIF: Cost, Insurance & Freight

Seller’s Responsibility: Freight and insurance to the destination port
Buyer’s Responsibility: Risk after goods are loaded

Similar to CFR, but the seller must also insure the goods for 110% of their value during transit. Use CIF for non-containerized sea freight; for other transport modes, CIP is preferable.