2021-02-14
WHAT DOES EACH INCOTERM MEAN?
Worldwide transport of goods requires a lot of arrangements. Who pays what, and who is responsible for what requirements and risks? To clarify this, Incoterms have been drawn up. This is an international standard detailing the transportation rights and duties of both buyers and sellers.
Incoterms explained
For the international transport of goods, a lot of things need to be arranged. One of the most important things is to make sure there are clear agreements with the foreign supplier (or customer). To clarify this, Incoterms have been drawn up and it stands for “International Commercial Terms”. Incoterms are an international standard detailing the transportation rights and duties of both buyers and sellers. For example:
Obligations of the seller versus the obligations of the purchaser;
Who is responsible for the insurance, licenses, authorizations and other formalities;
Who arranges the (different kinds of) transportation;
At what point in the process, the responsibilities, costs and risks shift from the seller to the buyer.
Types of incoterms
There are different kind of Incoterms. Varying from the one the vendor is solely responsible for the entire transport, to the one on which the buyer carries all responsibilities to get the goods from the factory of the seller to his own doorstep and almost everything in between. Below are the different incoterms noted and explained, descending on the extent to which the purchaser bears the risk.
The incoterms “Ex Works” up to “Delivery Duty Paid” can be applied to all types of transport. The delivery conditions “Free Alongside Ship” up to “Cost, Insurance and Freight” can only be applied to sea freight shipments. For every kind of incoterm is it important that the place is mentioned where the risks and responsibilities shift from seller to buyer.
1. Ex Works (EXW)
When agreed to deliver goods Ex Works (ready in factory), the seller is only responsible for the availability of the goods at his warehouse or factory. He basically needs to open the door for the person who comes to collect the goods. He ensures that goods with minimal packaging and invoices are ready to be picked up; his responsibilities end there.
The buyer has almost all responsibilities of the costs and risks relating to the packing, loading and transportation of the goods. From the factory to the final destination. Moreover, it is his responsibility to arrange all customs procedures such as export declaration, the clearance in the country of production and clearance in the destination country. Ex Works is generally not recommended for sea- and air freight shipping, while at road transport this incoterm is very often used.
incoterm exw
2. Free Carrier (FCA)
Free Carrier is a delivery condition that is increasingly being used. Especially instead of Ex Worx and as an alternative of Free On Board for container transport(حمل و نقل دریایی), Free Carrier is gaining popularity. Within this incoterm, the seller is responsible for all customs activities in the country of origin and ensures that the goods are cleared, the invoice and the packing are both taken care of and that an export license is available. Besides this, the seller is responsible for the (optional) transport to a beforehand agreed upon carrier on a beforehand agreed upon place. Since the place can also be on the doorstep of the seller, it is important that the place is included in the incoterm document. When the carrier takes the goods, the buyer bears all responsibilities regarding risks of loss or damage.
FCA incoterm
3. Carriage Paid To (CPT)
The seller arranges the customs clearance, pays the export fees and arranges and pays a carrier that delivers the goods at a pre-arranged place. At the moment the (first) carrier takes the goods, he takes over the risks, costs and responsibilities of the seller. He carries the responsibilities, until he has delivered the goods. Carriage Paid To is also an incoterm that is being used more and more. Particularly in container transport, it is often recommended to apply CPT instead of CFR.
CPT incoterm
4. Carriage and Insurance Paid To (CIP)
Carriage and Insurance Paid To is roughly the same as Carriage Paid To, except for the fact that the seller is also obligated to arrange and pay a (minimum coverage) cargo insurance. When CIP is applied, the risks and responsibilities shift from seller to buyer when the seller transfers the goods to the carrier, just like at CPT.
incoterm CIp
5. Delivery At Terminal (DAT)
The seller delivers the goods to the buyer at the agreed place or port (terminal). The seller bears all the risks and costs associated with bringing the goods; he makes sure the goods are accessible from the transportation vehicle, but has no obligation to unload them himself. At this moment, the risk passes from seller to buyer. The buyer is required to declare the goods to customs and to arrange all customs formalities such as
source: https://www.hst.nl/
Worldwide transport of goods requires a lot of arrangements. Who pays what, and who is responsible for what requirements and risks? To clarify this, Incoterms have been drawn up. This is an international standard detailing the transportation rights and duties of both buyers and sellers.
Incoterms explained
For the international transport of goods, a lot of things need to be arranged. One of the most important things is to make sure there are clear agreements with the foreign supplier (or customer). To clarify this, Incoterms have been drawn up and it stands for “International Commercial Terms”. Incoterms are an international standard detailing the transportation rights and duties of both buyers and sellers. For example:
Obligations of the seller versus the obligations of the purchaser;
Who is responsible for the insurance, licenses, authorizations and other formalities;
Who arranges the (different kinds of) transportation;
At what point in the process, the responsibilities, costs and risks shift from the seller to the buyer.
Types of incoterms
There are different kind of Incoterms. Varying from the one the vendor is solely responsible for the entire transport, to the one on which the buyer carries all responsibilities to get the goods from the factory of the seller to his own doorstep and almost everything in between. Below are the different incoterms noted and explained, descending on the extent to which the purchaser bears the risk.
The incoterms “Ex Works” up to “Delivery Duty Paid” can be applied to all types of transport. The delivery conditions “Free Alongside Ship” up to “Cost, Insurance and Freight” can only be applied to sea freight shipments. For every kind of incoterm is it important that the place is mentioned where the risks and responsibilities shift from seller to buyer.
1. Ex Works (EXW)
When agreed to deliver goods Ex Works (ready in factory), the seller is only responsible for the availability of the goods at his warehouse or factory. He basically needs to open the door for the person who comes to collect the goods. He ensures that goods with minimal packaging and invoices are ready to be picked up; his responsibilities end there.
The buyer has almost all responsibilities of the costs and risks relating to the packing, loading and transportation of the goods. From the factory to the final destination. Moreover, it is his responsibility to arrange all customs procedures such as export declaration, the clearance in the country of production and clearance in the destination country. Ex Works is generally not recommended for sea- and air freight shipping, while at road transport this incoterm is very often used.
incoterm exw
2. Free Carrier (FCA)
Free Carrier is a delivery condition that is increasingly being used. Especially instead of Ex Worx and as an alternative of Free On Board for container transport(حمل و نقل دریایی), Free Carrier is gaining popularity. Within this incoterm, the seller is responsible for all customs activities in the country of origin and ensures that the goods are cleared, the invoice and the packing are both taken care of and that an export license is available. Besides this, the seller is responsible for the (optional) transport to a beforehand agreed upon carrier on a beforehand agreed upon place. Since the place can also be on the doorstep of the seller, it is important that the place is included in the incoterm document. When the carrier takes the goods, the buyer bears all responsibilities regarding risks of loss or damage.
FCA incoterm
3. Carriage Paid To (CPT)
The seller arranges the customs clearance, pays the export fees and arranges and pays a carrier that delivers the goods at a pre-arranged place. At the moment the (first) carrier takes the goods, he takes over the risks, costs and responsibilities of the seller. He carries the responsibilities, until he has delivered the goods. Carriage Paid To is also an incoterm that is being used more and more. Particularly in container transport, it is often recommended to apply CPT instead of CFR.
CPT incoterm
4. Carriage and Insurance Paid To (CIP)
Carriage and Insurance Paid To is roughly the same as Carriage Paid To, except for the fact that the seller is also obligated to arrange and pay a (minimum coverage) cargo insurance. When CIP is applied, the risks and responsibilities shift from seller to buyer when the seller transfers the goods to the carrier, just like at CPT.
incoterm CIp
5. Delivery At Terminal (DAT)
The seller delivers the goods to the buyer at the agreed place or port (terminal). The seller bears all the risks and costs associated with bringing the goods; he makes sure the goods are accessible from the transportation vehicle, but has no obligation to unload them himself. At this moment, the risk passes from seller to buyer. The buyer is required to declare the goods to customs and to arrange all customs formalities such as
source: https://www.hst.nl/
incoterms
The Incoterms![[レジスタードトレードマーク]](https://blog.ss-blog.jp/_images_e/219.gif)
(abbreviation of International commercial terms) rules were developed by the International Chamber of Commerce to facilitate international trade and for the interpretation of the trade terms that the parties to a contract of sale could agree to apply..
Incoterms were first introduced in 1936 and were revised in 1957, 1967, 1976, 1980, 1990, 2000 and 2010 to accommodate changes as global trade developed and evolved..
Currently, in its 8th version, the Incoterms rules have become an internationally recognized and accepted standard and are used worldwide in international and domestic contracts for the sale of goods and have become an essential part of the day-to-day international trade and domestic trade..
The rules have been developed and maintained by experts and practitioners brought together by the ICC.. Launched in mid-September 2010, Incoterms 2010 came into effect on 1 January 2011 and is the latest version till it will be replaced by Incoterms 2020 on 25th September of 2019..
Incoterms help traders avoid costly misunderstandings by clarifying the tasks, costs and risks involved in the delivery of goods from sellers to buyers and has become the trademark used to designate the rules devised by the ICC..
source: wikipedia
(اینکوترمز)
(abbreviation of International commercial terms) rules were developed by the International Chamber of Commerce to facilitate international trade and for the interpretation of the trade terms that the parties to a contract of sale could agree to apply..Incoterms
were first introduced in 1936 and were revised in 1957, 1967, 1976, 1980, 1990, 2000 and 2010 to accommodate changes as global trade developed and evolved..Currently, in its 8th version, the Incoterms
rules have become an internationally recognized and accepted standard and are used worldwide in international and domestic contracts for the sale of goods and have become an essential part of the day-to-day international trade and domestic trade..The rules have been developed and maintained by experts and practitioners brought together by the ICC.. Launched in mid-September 2010, Incoterms
2010 came into effect on 1 January 2011 and is the latest version till it will be replaced by Incoterms 2020 on 25th September of 2019..Incoterms help traders avoid costly misunderstandings by clarifying the tasks, costs and risks involved in the delivery of goods from sellers to buyers and has become the trademark used to designate the rules devised by the ICC..
source: wikipedia
(اینکوترمز)
Bulk service
By launching a bulk cargo (bulk service) and renting (chartering) unit, the Offshore Company is able to supply various types of bulk carriers, two-deck (in the size of 2000 tons DWT to 55000 tons DWT, etc.) for cargo Ordinary such as cement, gypsum, lime, coal, iron ore, cement soil, salt, grains as well as baggage and assigning suitable ships for customers in the shortest time for dear customers. we are here.
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