1

K. Vanheusden
Director
Belgian Foreign Trade Agency
koen.vanheusden@abh-ace.be
WHAT WHAT WHAT WHAT ARE THE ARE THE ARE THE ARE THE
INCOTERMS INCOTERMS INCOTERMS INCOTERMS RULES RULES RULES RULES INCOTERMS INCOTERMS INCOTERMS INCOTERMS RULES RULES RULES RULES
ALL ALL ALL ALL ABOUT ABOUT ABOUT ABOUT? ?? ?
2
3
E Publication ICC n 715 (Incoterms
2010)
E English translations
E Publication ICC n 720 (Jan RAMBERG,
ICC Guide to Incoterms 2010)
4
E Publication ICC n 720 (Jan RAMBERG,
ICC Guide to Incoterms 2010)
E http://www.incoterms.org
THE 11 THE 11 THE 11 THE 11
INCOTERMS INCOTERMS INCOTERMS INCOTERMS 2010 2010 2010 2010 INCOTERMS INCOTERMS INCOTERMS INCOTERMS 2010 2010 2010 2010
RULES RULES RULES RULES
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EXW ( named place)
Ex Works lUsine - en fbrica
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FCA ( named place)
Free Carrier Franco Transporteur - franco transportista
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CPT ( named place of destination)
Carriage Paid To Port pay jusqu - transporte
pagado hasta
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CIP ( named place of destination)
Carriage and Insurance Paid to Port pay, assurance
comprise jusqu - transporte y seguro pagados hasta
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DAT (named terminal at port or place of
destination)
Delivered at Terminal Rendu au Terminal - entrega en
terminal
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DAP (named place of destination)
Delivered at Place Rendu au Lieu de Destination - entrega en
lugar
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DDP ( named place)
Delivered Duty Paid Rendu Droits Acquitts-
entregada derechos pagados
12
FAS ( named port of shipment)
Free Alongside Ship franco le long du navire- franco al
costado del buque
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FOB ( named port of shipment)
Free On Board franco bord - franco a bordo
14
CFR ( named port of destination)
Cost and Freight Cot et Fret - coste y flete
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CIF ( named port of destination)
Cost, Insurance Freight Cot, Assurance et Fret - coste,
seguro y flete
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LEGAL STATUS OF THE LEGAL STATUS OF THE LEGAL STATUS OF THE LEGAL STATUS OF THE
INCOTERMS INCOTERMS INCOTERMS INCOTERMS 2010 2010 2010 2010 INCOTERMS INCOTERMS INCOTERMS INCOTERMS 2010 2010 2010 2010
RULES RULES RULES RULES
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Legislation customs contractual
facultative complementary law variants
can not be abolished
Legal status of the
Incoterms 2010 Rules
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Recommendation n5 of the United Nations Centre for Trade
Facilitation and Electronic Business (UN/CEFACT) March 2000
June 5, 2011
art. 7,2 CISG international contracts of sale are to be
interpreted according to transnational general principles
Intrastat antidumping (CIF) customs value (CIF FOB)
single administrative document (case 20) origin definition (EXW)
Soft law
Alternative trade terms
Free House - DIS - Door-to-door FIS
FOA FOR/FOT FOB Border C&F
FOB+I PAF FOBs FOB+ CAF
CIF landed CIF Outturn Weights EXF CIF landed CIF Outturn Weights EXF
- C&I (CNI)
RAFTD 1941
Ex / FOB (6) / FAS / C&F / CIF / Ex Dock
UCC
FOB (3) / FAS / C&F / CIF / Ex Ship
(Revised) American
Foreign Trade Definitions
C FOB (named inland carrier at named inland point of
departure) - EXW loaded
C FOB (named inland carrier at named inland point of
departure) - Freight prepaid to (named point of
exportation) exportation)
C FOB (named inland carrier at named inland point of
departure) - Freight allowed (named point)
C FOB (named inland carrier at named point of exportation)
C FOB Vessel (named port of shipment)
FOB (named inland point in country of importation) -
DDP
UCC 2-319/2-324
E FOB (place of shipment) = EXW-FCA
E FOB (place of destination) = DDP
E FOB (vessel/car/vehicle) = FCA loaded
E FAS
E C&F
E CIF
E Ex Ship = DEQ
CLASSIFICATION CLASSIFICATION CLASSIFICATION CLASSIFICATION OF OF OF OF
THE THE THE THE INCOTERMS INCOTERMS INCOTERMS INCOTERMS THE THE THE THE INCOTERMS INCOTERMS INCOTERMS INCOTERMS
2010 2010 2010 2010 RULES RULES RULES RULES
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four different categories:
1. E: the seller only makes the
goods available to the buyer
at the sellers own premises;
2. F: the seller is called upon
to deliver the goods to a
two classes:
1. seven Incoterms 2010
rules that can be used
irrespective of the mode of
transport selected and
irrespective of whether one
Goods are
collected at
Goods are
shipped from
to deliver the goods to a
carrier appointed by the
buyer;
3. C: the seller has to contract
for carriage, but without
assuming the risk;
E D: the seller bears all costs
and risks needed to bring the
goods to the place of
destination.
irrespective of whether one
or more than one mode of
transport is employed;
2. four sea and inland
waterway rules where the
point of delivery and the
place to which the goods
are carried to the buyer are
both ports.
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shipped from
Goods are
shipped to
Goods are
delivered at
Container -
FCL
Inland
terminal - LCL
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Port terminal
- LCL
Quay On board
Passing of
risk
FCA
CPT CIP
FOB
CFR CIF
FAS
Incoterms 2010 Incoterms 2010
EXW EXW
transport transport
BUYER BUYER SELLER SELLER
transport transport
risk risk
costs costs
25 25
FCA FCA
transport transport
risk risk
costs costs
transport transport
transport transport
risk risk
costs costs
transport + insurance transport + insurance
risk risk
costs costs
CPT CPT
CIP CIP
Incoterms 2010 Incoterms 2010
BUYER BUYER SELLER SELLER
transport transport
risk risk
costs costs
transport transport
risk risk
DAT DAT
DAP DAP
26 26
risk risk
costs costs
transport transport
risk risk
costs costs
DDP DDP
DAP DAP
Incoterms 2010 Incoterms 2010
FAS FAS
transport transport
risk risk
costs costs
transport transport
BUYER BUYER SELLER SELLER
transport transport
27 27
transport transport
risk risk
costs costs
transport transport
transport transport
risk risk
costs costs
transport + insurance transport + insurance
risk risk
costs costs
CFR CFR
CIF CIF
STRUCTURE STRUCTURE STRUCTURE STRUCTURE OF THE OF THE OF THE OF THE
INCOTERMS INCOTERMS INCOTERMS INCOTERMS 2010 2010 2010 2010 INCOTERMS INCOTERMS INCOTERMS INCOTERMS 2010 2010 2010 2010
RULES RULES RULES RULES
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Structure of the
Incoterms 2010 rules: 10 articles
A THE SELLERS OBLIGATIONS
C General obligations of the seller
C Licences, authorizations, security
clearances and other formalities
C Contracts of carriage and insurance
B THE BUYERS OBLIGATIONS
C General obligations of the buyer
C Licences, authorizations, security
clearances and other formalities
C Contracts of carriage and
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C Contracts of carriage and insurance
C Delivery
C Transfer of risks
Division of costs
C Notice to the buyer
Delivery document
Checking packaging marking
1 Assistance with information and
related costs
C Contracts of carriage and
insurance
C Taking delivery
C Transfer of risks
Division of costs
C Notice to the seller
Proof of delivery
Inspection of goods
1 Assistance with information and
related costs
Incoterms rules and
division of costs (6 4,3,2)
+ import and + import and
EXW EXW FCA A4b FCA A4b FAS FAS FOB FOB CFR/CPT CFR/CPT
CIF/CIP CIF/CIP
DAP DAP
((CFR/CPT CFR/CPT
A6) A6)
(CIF/CIP (CIF/CIP
A6) A6)
DAT DAT
DAP DAP DDP DDP

FCA A4a FCA A4a

DAT DAT
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+ + loading loading + export + export
formalities formalities
+ + precarriage precarriage
+ THC/CSC + + THC/CSC + scancosts scancosts
+ port passage (PLTC) + port passage (PLTC)
+ + freight freight + +
insurance insurance
+ +
discharging discharging
+ + summary summary
declaration declaration
+ Transit + + Transit +
oncarriage oncarriage
+ import and + import and
duties duties
net net sales sales
price price
+ transport + transport
packaging packaging
+ + loading loading
(port (port customs customs !) !)
+ + oncarriage oncarriage
+ THC/CSC + THC/CSC
Incoterms rules
and risk transfer (5 4)
EXW EXW FCA A4b FCA A4b
CIP CIP -- CPT CPT
FAS FAS FOB FOB
CFR CFR
CIF CIF
DAP DAP DAT DAT
DAP DAP
DDP DDP
FCA A4a FCA A4a
CPT CPT -- CIP CIP
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loaded loaded in in
container, container, on on
truck truck
Not Not discharged discharged
from fromtruck truck
On On quay quay ((barge barge,..) ,..)
alongside alongside ship ship
On On board board
not not
discharged discharged
Discharged Discharged
on on quay quay in in
terminal terminal
ready ready for for
collection collection
Not Not
discharged discharged at at
destination destination
packed packed, , not not
loaded loaded
on on board; board;
(port (port customs customs))
Incoterms rules and documents at
expense/risk of the seller (+ obligation to assist)
+ import + import invoice invoice
EXW EXW FCA A4b FCA A4b FAS FAS FOB FOB
CFR CFR
CIF CIF
DAP DAP DAT DAT DAP DAP DDP DDP FCA A4a FCA A4a CPT CPT
CIP CIP
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Proof Proof of of delivery delivery
(CMR, ) + export (CMR, ) + export
license license + export + export
daclaration daclaration + UGD + UGD
+ FCR + FCR
+ receipt on quay + receipt on quay
+ ISPM 15 + ISPM 15 + +
D/O + CMR D/O + CMR
+ + summary summary
declaration declaration
+ Transit + Transit
+ import + import invoice invoice
+ import + import license license
+ + CoO CoO + import + import
declaration declaration + +
certificate certificate of of
conformity conformity + +
VAT VAT--nn
Invoice Invoice + +
packing packing
list list
+ B/L (+ + B/L (+
insurance insurance
certificate certificate))
+ B/L + B/L CMR CMR AWB AWB CIM CIM
(+ (+ insurance insurance certificate certificate))
Purpose of the
Incoterms rules
Ecosts (freight, customs, assistance,
insurance)
Erisks (transfer)
6 4, 3, 2
5 4
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Etasks (documents, formalities,
notices)
Edelivery
in the relationship seller - buyer
5 4
2, 9, 10
4 7, 8
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RELEVANCE RELEVANCE RELEVANCE RELEVANCE OF THE OF THE OF THE OF THE
INCOTERMS INCOTERMS INCOTERMS INCOTERMS RULES RULES RULES RULES TO TO TO TO
LOGISTICAL LOGISTICAL LOGISTICAL LOGISTICAL OPERATORS OPERATORS OPERATORS OPERATORS LOGISTICAL LOGISTICAL LOGISTICAL LOGISTICAL OPERATORS OPERATORS OPERATORS OPERATORS
THAT THAT THAT THAT ARE NO PARTY ARE NO PARTY ARE NO PARTY ARE NO PARTY TO TO TO TO
THE CONTRACT OF SALE THE CONTRACT OF SALE THE CONTRACT OF SALE THE CONTRACT OF SALE
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Incoterms rules
dont apply to
E projects consignment deliveries -
E relationship with the forwarder carrier
E relationship with the insurance cy
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E relationship with the bank
E conditions/place of payment
E transfer of title
E sanctions in case of breach
E applicable law
Structure
A THE SELLERS OBLIGATIONS
C General obligations of the seller
C Licences, authorizations, security
clearances and other formalities
C Contracts of carriage and insurance
B THE BUYERS OBLIGATIONS
C General obligations of the buyer
C Licences, authorizations, security
clearances and other formalities
C Contracts of carriage and insurance
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C Contracts of carriage and insurance
C Delivery
C Transfer of risks
Division of costs
C Notice to the buyer
Delivery document
Checking packaging marking
1 Assistance with information and
related costs
C Contracts of carriage and insurance
C Taking delivery
C Transfer of risks
Division of costs
C Notice to the seller
Proof of delivery
Inspection of goods
1 Assistance with information and
related costs
Logistics, carriers & freight
forwarders (+ booking agents)
How do the Incoterms rules affect shipping
(instructions)?
E Who has to organize carriage who should under
the contract of sale be the shipper on the contract
of carriage? of carriage?
E Who is the sender; the loader?
E Where do the goods go to come from
E Who pays freight surcharges demurrage &
detention under
the contract of carriage
the contract of sale
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Logistics, carriers & freight
forwarders (+ booking agents)
How do the Incoterms rules affect shipping
(instructions)?
E What are freight, charges and costs of carriage?
E How do freight terms (FLT, FIO, FIOST, Hook-Hook E How do freight terms (FLT, FIO, FIOST, Hook-Hook
) affect the cost splitting between buyer and
seller?
E Which documents prove delivery?
even though the booking agent may give
instructions that are not consistent with the contract
of sale.
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EXW
FCA freight forwarders
terminal
O Road Way Bill arrival
O FCR
DAT
Antwerp
O D/O
O Release notice
DAP
Munich
DDP Munich
O Road Way Bill
AWB CIM
B/L HB/L
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O ready for
collection?
O PSI?
FCA Sellers
premises
O Road Way Bill
O Through B/L
O Arrival doc
CPT
CIP
B/L HB/L
FAS
Houston
O ?
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FOB
Houston
O Mates receipt
O B/L?
CFR
CIF
O Ocean port to port
B/L full set
INCOTERMS INCOTERMS INCOTERMS INCOTERMS 2010 2010 2010 2010 INCOTERMS INCOTERMS INCOTERMS INCOTERMS 2010 2010 2010 2010
RULES RULES RULES RULES WHATS WHATS WHATS WHATS NEW? NEW? NEW? NEW?
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Incoterms 2010 rules:
whats new?
1. Introduction 22p. 5p.
2. Guidance notes + drawings
3. 13 11 Incoterms rules;
DAF DES DDU DAP
DEQ DAT
4. Classification all modes vs. maritime only
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4. Classification all modes vs. maritime only
5. Domestic and international trade
6. Electronic documents have full functional equivalence
to paper documents B/L?
7. Adjustment insurance cover to the Institute Cargo
Clauses 2009
8. First Incoterms rules since 9/11 Incorporation
Security clearance A2/B2 and Security related
information A10/B10
Incoterms 2010 rules:
whats new?
9. Terminal Handling Charges (THC) improved
wording A6/B6
10.String sales (deliver or procure goods so delivered)
11.FCA + FAS + FOB additional service (freight
collect)
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collect)
12.EXW: if the seller loads at the risk of the buyer
13.FOB CFR CIF: critical point ships rail on
board (port customs).
14.FOB CFR CIF: no longer an express reference to the
B/L but
15.DDP: preshipment inspection - VAT
INCOTERMS INCOTERMS INCOTERMS INCOTERMS 2010 2010 2010 2010 INCOTERMS INCOTERMS INCOTERMS INCOTERMS 2010 2010 2010 2010
RULES RULES RULES RULES IN IN IN IN PRACTICE PRACTICE PRACTICE PRACTICE
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Are you prepared to
bear all costs and risks
until arrival of the
goods at the buyers
premises?
Can you bring the
goods to the agreed
place of delivery
(across the border)?
May the goods be
handed over to the
buyer without
endangering payment?
Can you obtain the
required import
licenses and carry out
the import formalities?
Can you recover the
import VAT?
DDP
Are you prepared to
organise transport and
Is the place of
destination a sea port?
Do the goods travel
under a B/L (or a non
negotiable Sea
Are the goods shipped
in a container?
DAP
CFR
CIF
Are you prepared to bear all
costs and risks until arrival
of the goods at a place
(terminal) of destination
where the buyer will come
to collect the goods?
Can you bring the
goods to the terminal of
destination where the
buyer will come to
collect them?
DAT
Y Y Y
Y
Y
Y
Y
Y
N
N
N
N
N
N
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organise transport and
pay the freight up to the
agreed place of
destination (without
guarantee of arrival)?
destination a sea port? negotiable Sea
Waybill)?
in a container?
Are you prepared to
bring the goods to the
agreed place of
international/main
shipment and carry
out all formalities
upon exportation
Are the goods shipped
in a container, by
plane, truck, rail, a
combination of
modes?
Are the goods handed
over to the carrier
(captain) on board of
a vessel?
CIF
CPT
CIP
FOB
FCA
EXW
Are the goods handed
over alongside a
vessel (on a barge,
)?
FAS
Y
Y
Y
Y
Y
Y
Y
Y
N
N N
N
N
N
N
Are you prepared to
bear all costs and risks
from the sellers
warehouse?
Can you obtain the
required export licenses
and carry out all export
and transit formalities?
EXW
Are you prepared to
organise main carriage
(including
consolidation), pay the
freight and bear the risk
of the goods until
arrival at the agreed
place of destination?
Are the gpods shipped
by air, rail, road or
container?
Do you accept all risks
from the moment the
goods are handed over
to the carrier in
terminal?
Do you accept another
transport document
than a negotiable B/L?
FCA
FAS
Do you accept the
risks from the moment
the goods have been
presented alongside
the (ocean going)
vessel?
Y
Y
Y
Y
Y Y
Are you capable to
load the goods at the
sellers warehouse?
Do you accept
the risks from
the moment
the captain
FOB
N
N
N
N
N
N
N
N
Y
Y
Y
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Are you prepared to
bear the risks during
transportation but
have the seller
organise and pay for
transportation to the
agreed place?
Do you accept the risks
from the moment the
goods are handed over
in the terminal of
departure of main
carriage?
CPT
CIP
CFR
CIF
DAT
DAP
vessel?
Do you accept the risks from the
moment the goods have been placed
on board the ship?
Is the place of destination a
terminal where you will come to
collect the goods?
Are the goods shipped
by air, road, rail or
container?
Do you accept any
other transport
document than a
negotiable B/L?
Y
the captain
has received
the goods on
board the
ship?
FOB
Do you want to clear the
goods for importation in
the country of destination?
DDP
N
N
N
N
N
N
N
Y
Y
Y
Y
Y Y Y
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