Incoterms® (International Commercial Terms) are a set of 11 standard trade terms published by the International Chamber of Commerce (ICC). They define who is responsible for the cost, risk and insurance at each stage of moving goods from seller to buyer. The current edition is Incoterms 2020.
| Code | Term | Mode | Meaning |
|---|---|---|---|
| EXW | Ex Works | Any mode | The seller makes the goods available at their premises. The buyer bears all costs and risks of loading, export clearance, carriage and import — the seller's minimum obligation. |
| FCA | Free Carrier | Any mode | The seller delivers the goods, cleared for export, to the carrier nominated by the buyer at the named place. Risk transfers once handed over. |
| FAS | Free Alongside Ship | Sea/inland waterway | The seller delivers when goods are placed alongside the vessel at the named port of shipment. The buyer bears all costs and risks from that point. |
| FOB | Free On Board | Sea/inland waterway | The seller delivers when the goods are loaded on board the vessel nominated by the buyer. Risk passes once the goods are on board. |
| CFR | Cost and Freight | Sea/inland waterway | The seller pays the cost and freight to bring the goods to the destination port, but risk transfers to the buyer once on board at origin. |
| CIF | Cost, Insurance and Freight | Sea/inland waterway | Same as CFR, but the seller also procures minimum marine insurance against the buyer's risk of loss or damage during carriage. |
| CPT | Carriage Paid To | Any mode | The seller pays carriage to the named destination, but risk transfers to the buyer when goods are handed to the first carrier. |
| CIP | Carriage and Insurance Paid To | Any mode | Same as CPT, but the seller also provides insurance (all-risks cover under Incoterms 2020) for the carriage. |
| DAP | Delivered At Place | Any mode | The seller bears all risks and costs of delivering the goods to the named place, ready for unloading (not import-cleared). |
| DPU | Delivered at Place Unloaded | Any mode | The seller delivers and unloads the goods at the named place. The only Incoterm requiring the seller to unload. (Replaced DAT in 2020.) |
| DDP | Delivered Duty Paid | Any mode | The seller's maximum obligation: delivers goods cleared for import, with all duties and taxes paid, at the named destination. |
How to choose an Incoterm
Terms range from EXW (minimum seller obligation — buyer does almost everything) to DDP (maximum seller obligation — seller delivers fully cleared and duty-paid). FOB and CIF apply only to sea freight, while FCA, CPT, CIP, DAP, DPU and DDP work for any mode including containerised and multimodal transport.
Every bill of lading in our trade database records the shipment terms, so you can see exactly how real traders in each country structure their deals. ← Back to all resources