incoterms for apparel export
TRANSCRIPT
Incoterms
These are Internationally Accepted Commercial
Terms defining the respective roles and
responsibilities (including costs) of the buyer
and seller in the arrangement of transportation
and other obligations
Incoterms 2000
First published by the ICC in 1936
ICC (International Chamber of Commerce) Official
Rules for the Interpretation of Trade terms.
Purpose is to provide a set of international rules for
the interpretation of the most commonly used trade
terms.
10 categories describing where risks lie between
seller and buyer
International Commercial Terms (INCOTERMS)
Incoterms – Purpose and Scope
Pricing terms, shipping terms, sales terms
Apply to international trade
Define the rights and obligation of the
parties to the contract of sale with respect to
the delivery of goods sold.
Four Groups of Incoterms
Less
Control
More
Control1) “E” group
2) “F” group
3) “C” group
4) “D” group
Seller Buyer
More
ControlLess
Control
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The “E”-term is the term in which the seller’s
obligation is at its minimum.
Seller delivers when goods placed at disposal of
buyer
Incoterms 2000
The “F” –terms require the seller to deliver
goods for carriage as instructed by the
buyer.
FCA
FAS
FOB
Incoterms 2000
The “C” –terms require the seller to contract
for carriage at his expense – to a specified
point.
CFR
CIF
CPT
CIP
Incoterms 2000
The “D” –terms require the seller to take the
goods all the way to destination at the border
or within the country of import.
DAF
DES
DEQ
DDU
DDP
Incoterms Group E - Departure:
EXW. Ex Works (named place)
Group F - Main Carriage Unpaid: FCA Free Carrier (named place)
FAS Free Alongside Ship named loading port)
FOB Free On Board (named loading port)
Group C - Main Carriage Paid: CFR Cost and Freight (named destination port)
CIF Cost, Insurance and Freight (named destination port)
CPT Carriage Paid To (named destination)
CIP Carriage and Insurance Paid to (named destination)
Group D - Arrival: DAF Delivered At Frontier (named place)
DES Delivered Ex Ship (named port)
DEQ Delivered Ex Quay (named port)
DDU Delivered Duty Unpaid (named destination place)
DDP Delivered Duty Paid (named destination place)
In Summary
Buyer’s Objective: maximize control of supply chain, use FOB, FCA, or FAS
Must name a place after the INCOTERM
INCOTERMS are negotiable!
INCOTERMS should appear on all commercial documents
Establish a close relationship with a forwarder
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