A set of 11 international standard trade terms which last version is Incoterms 2010. Incoterms allows the parties to designate a point at which the costs and risks of transport are precisely divided between the seller and the buyer. Incoterms also allocate responsibility for customs clearance/duties between the parties. Since Incoterms are not law but are contractual standard terms, they do not apply to a given transaction unless the parties specifically incorporate them by referring to last version of Incoterms. Incoterms are elements of the international sale contract, which may be derived from the seller´s tender or proforma invoice. Thus, Incoterms only apply to the seller and buyer, one of whom will assume dovetail with the Incoterms in terms of allocation of transport costs and risks, but this will depend on the shipper giving precise directions to the carrier to ship according to the constraints of the given Incoterms. The 11 Incoterms are divided in two groups: those than can be used for any mode or modes of transport, and those used only for sea and inland waterway transport.
Incoterms for any mode or modes of transport:
- EXW Ex Works.
- FCA Free Carrier.
- CPT Carriage Paid to.
- CIP Carriage and Insurance Paid to.
- DAT Delivered at Terminal.
- DAP Delivered at Place
- DDP Delivered Duty Paid.
Incoterms only for sea and inland waterway transport:
See each Incoterms for definition of seller´s and buyer´s obligations. Practical Guide to Incoterms.