Incoterms® 2020: quick guide and articles by rule

EXW (Ex Works): the seller makes the goods available at its premises or another agreed place, not loaded and not cleared for export.

FCA (Free Carrier): the seller hands the goods, cleared for export, to the carrier chosen by the buyer at the agreed place.

CPT (Carriage Paid To): the seller contracts and pays for carriage to the agreed destination, but risk passes to the buyer when the goods are handed to the first carrier.

CIP (Carriage and Insurance Paid To): as CPT, plus cargo insurance taken out by the seller for the buyer’s benefit.

DAP (Delivered at Place): the seller organises and pays for carriage to the destination and bears the risk up to it.

DPU (Delivered at Place Unloaded): as DAP, but the seller also unloads the goods at destination and bears the risk until they are unloaded.

DDP (Delivered Duty Paid): the seller takes on the maximum obligation: carriage, risk up to destination, import clearance and import duties, usually including import VAT.

FAS (Free Alongside Ship): the seller delivers the goods alongside the vessel at the agreed port of shipment, cleared for export.

FOB (Free On Board): the seller loads the goods on board the vessel chosen by the buyer at the port of shipment, cleared for export.

What does FOB mean?

CFR (Cost and Freight): the seller pays for sea carriage to the port of destination, but risk passes to the buyer when the goods are on board at the port of shipment.

CIF (Cost, Insurance and Freight): as CFR, plus cargo insurance taken out by the seller for the buyer’s benefit.