1. society
2. work
3. contracts

INCOTERMS® 2010
American Institute for International Steel Webinar
January 14, 2011
Presenters: Mary Jo Muoio, OHL
Diane Raffle, OHL
Moderator: Steven W. Baker, Esq.
What INCOTERMS ® are not:
 Terms of Sale or Passage of Title
 Legally required
 Universal or exclusive
2
What INCOTERMS ® are:
 Privately developed by the ICC
 Internationally understood
 Different than UCC or other
terminologies
 Shipping terms
3
INCOTERMS ® Should be Identified
 Cite specifically
 By version
 Clearly spell out any
modifications or variations
4
Incoterms® 2010
What to Know About Which To Use
Incoterms® 2010
 Series of internationally-recognized,
standardized trade terms published
by the International Chamber of
Commerce
 INternational COmmercial TERMS
 Used for international and domestic
transactions
 Accepted by governments, legal
authorities, and business
On sale now!
 Published in book
format available
from the ICC at:
www.iccbooks.com
Incoterms® 2010
By the
International Chamber of Commerce
(ICC)
ICC Publication No.715
2010 Edition
Also available as an attractive wall
hanging. Suitable for framing!
 Incoterms®
2010 Wallchart
International
Chamber of
Commerce (ICC)
ICC Publication No.
716 , 2010 Edition
Practical Impact of Change
 New terms were effective
January 1, 2011
 Old terms may apply to previously
issued contracts
 Make any necessary changes to
standard contract language and forms
 Inform colleagues
Changes—The Basics
 Two Categories of Terms
 Rules for any mode(s) of transportation
 Rules for sea and inland waterway
 Removal of 4 terms
 DAF, DES, DEQ, and DDU
 Inclusion of 2 new terms
 DAP and DAT
Changes—The Basics
 Documentation requirements can be
met with “equivalent electronic
records”
 Provides for security-related
requirements
 Specifically addresses responsibility
for terminal handling charges
 Allows for sellers in-transit sales to
procure goods shipped
Changes—The Terms
 Simplification
 Four categories reduced to two
 13 terms consolidated to 11
Incoterms® 2000
That was Then













EXW
FCA
FAS
FOB
CRF
CIF
CPT
CIP
DAF
DES
DEQ
DDU
DDP
Ex Works
Free Carrier
Free Alongside Ship
Free On Board
Cost And Freight
Cost, Insurance and Freight
Carriage Paid To
Carriage and Insurance Paid To
Delivered at Frontier
Delivered EX Ship
Delivered EX Quay
Delivered Duty Unpaid
Delivered Duty Paid
Removed four and added two





DAF
DES
DEQ
DDU
Delivered
Delivered
Delivered
Delivered

 DAT
 DAP
REMOVED
at Frontier
EX Ship
EX Quay
Duty Unpaid
ADDED
Delivered at Terminal
Delivered at Place
Incoterms® 2010
This is Now











EXW
FCA
FAS
FOB
CFR
CIF
CPT
CIP
DAT
DAP
DDP
Ex Works
Free Carrier
Free Alongside Ship
Free On Board
Cost and Freight
Cost, Insurance and Freight
Carriage Paid To
Carriage and Insurance Paid To
Delivered at Terminal
Delivered at Place
Delivered Duty Paid
Incoterms® USED FOR ALL MODES
OF TRANSPORTATION







EX
FCA
CPT
CIP
DAT
DAP
DDP
Ex Works
Free Carrier
Carriage Paid To
Carriage and Insurance Paid To
Delivered at Terminal
Delivered at Place
Delivered Duty Paid
Incoterms® 2010 USED ONLY FOR
MARINE




FAS
FOB
CFR
CIF
Free Alongside Ship
Free On Board
Cost and Freight
Cost, Insurance and Freight
EX WORKS (EXW)
(named place)
 Named place is where the shipment
originates – usually the seller’s premises
 Seller must have goods available and
packaged when promised
 Buyer must arrange pre-carriage, export
clearance, main carriage, import clearance
and on carriage
 Neither party is required to insure
 Transport Mode: All
Free Carrier (FCA)
(named place)
 Named place is either the place where the
shipment originates such as the seller’s
premises or another place agreed within
the seller’s country
 Seller is to have goods available and
packaged when promised, load collecting
vehicle, pre-carriage and export clearance
 Buyer must unload delivering vehicle, main
carriage, import clearance and on carriage
 Neither party is required to insure
 Transport mode: All modes
Free Alongside Ship (FAS)
(named port)
 Named port is alongside a vessel at port on
the seller’s side
 Seller is to deliver goods, export packed
alongside the buyer-designated vessel at
the port on the seller’s side along with
export clearance
 Buyer loads vessel, arranges main carriage,
import clearance and on carriage
 Neither party is required to insure
 Transport Mode: Vessel Only
Free on Board (FOB)
(named port)
 Named port is loaded on a vessel at a port
on the seller’s side
 Seller delivers the goods on board the
buyer-designated vessel at the port on the
seller’s side along with export clearance
 Buyer arranges main carriage, import
clearance and on carriage
 Neither party is required to insure
 Transport mode: Vessel Only
Cost & Freight (CFR)
(named port)
 Named port is on the buyer’s side
 Seller delivers goods export packed on
board the seller’s designated vessel at the
port on the seller’s side, pays
transportation costs to the agreed port on
buyer’s side, and arranges export clearance
 Buyer arranges vessel unloading, import
clearance and on carriage
 Neither party is required to insure
 Transport Mode: Vessel Only
Carriage Paid To (CPT)
(named place)
 Named place on buyer’s side
 Seller delivers goods export packed to the
carrier for transportation to the named
place of destination and will pay all
transportation costs thereto along with
arranging export clearance
 Buyer arranges import clearance and on
carriage
 Neither party is required to insure
 Transport mode: All modes
Cost, Insurance and Freight (CIF)
(named port)
 Named port is on buyer’s side
 Seller delivers goods export packed on
board the seller’s-designated vessel at port
on seller’s side, pays all transportation
costs to agreed port on the buyer’s side
and arranges export clearance
 Buyer arranges import clearance and on
carriage
 Seller must provide at least minimum
coverage
 Transport Mode: Vessel Only
Cost, Insurance Paid (CIP)
(named place)
 Named place on buyer’s side
 Seller delivers goods export packed to the
carrier for transportation to the named place of
destination and pays all transport costs thereto
along with arranging export clearance
 Buyer arranges import clearance and on
carriage
 Seller must provide at least minimum
insurance coverage
 Transport Mode: All Modes
Delivered at Terminal (DAT)
(named place)
 Named place at terminal on buyer’s side (a
terminal at the destination port or a
terminal not far beyond the destination port
where it’s yet to be cleared by Customs)
 Seller arranges export clearance and
delivers goods export packed to the named
destination terminal, pays all transport
costs thereto and unloads
 Buyer arranges import clearance and on
carriage
 Neither party is required to insure
 Transport Mode: All Modes
Delivered at Place (DAP)
(named place)
 Named place on buyer’s side
 Seller arranges export clearance, delivers
export packed goods to the named place of
destination and pays all transportation
costs thereto
 Buyer arranges import clearance and on
carriage
 Neither party is required to insure
 Transport mode: All Modes
Delivered Duty Paid (DDP)
(named place)
 Named place is on buyer’s side
 Seller arranges export clearance, delivers
export packed goods cleared for import at
the named destination and pays all
transportation costs thereto
 Buyer possibly responsible for unloading,
on carriage
 Neither party is required to insure
 Transport Mode: All Modes
For more information contact:
Mary Jo Muoio
Senior Vice President, Trade Services
[email protected]
973 402 8300
Diane Raffle
Drawback and Export Compliance Manager
[email protected]
267 570 2850