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Brief Descriptions of Incoterms

Incoterms are 13 standardized definitions of commonly used shipping and trade terms that cover issues such as control of goods and financial responsibilities such as payment of cargo insurance and freight. Incoterms provide traders with a common set of rules outlining each party’s obligations, thus reducing misunderstandings.

The International Chamber of Commerce (ICC) establishes and publishes the Incoterms. To use the terms correctly, trade practitioners should consult the ICC for the complete, authorized Incoterm definitions.

A listing of the 13 Incoterms

Departure

EXW: EX Works

Main carriage not paid by seller

FCA: Free Carrier
FAS: Free Alongside Ship
FOB: Free On Board

Main carriage paid by seller

CFR: Cost and Freight
CIF: Cost, Insurance and Freight
CPT: Carriage Paid To
CIP: Carriage and Insurance Paid to

Arrival

DAF: Delivered At Frontier
DES: Delivered Ex Ship
DEQ: Delivered Ex Quay
DDU: Delivered Duty Unpaid
DDP: Delivered Duty Paid


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