What are Incoterms?



Incoterms (International Commercial Terms) or Trade Terms are key segments of international contracts of sale. As it were, Incoterms are the selling terms that the purchaser and seller of products both consents to. They obviously state which tasks, expenses and risks are connected with the buyer and the seller. It also states when the seller’s costs and risks are transferred onto the purchaser. Thus, the main advantage of Incoterm is that buyers and sellers to rapidly, and without required to compose lengthy descriptions into their contracts or invoices, comprehend which of them has which responsibilities or obligations with respect to transport.

Incoterms have two components – the term used and a name place. For example, DDU Bangalore.

As per the Incoterms used, determines the division of costs and risks between the two parties and at what point the responsibility shifts from seller to buyer.

Following are the list of Incoterms,

EXW - Ex Works
FCA - Free Carrier
FAS - Free Alongside Ship
FOB - Free On Board
CFR - Cost and Freight
CIF - Cost, Insurance and Freight
CPT - Carriage Paid To
CIP - Carriage and Insurance Paid To
DAT - Delivered At Terminal
DAP - Delivered At Place
DDP - Delivered Duty Paid




Learn Exports Imports Free, Click here

Click here to know GST rate of your goods or service


What is the difference between BAF and CAF

What is the difference between High sea sales and imports

What is the difference between re-exports and re-imports

How does First Appraisement system of import customs clearance procedures work?

How does Letter of Credit work?

How does Bill of Lading work in DP payment terms?

How does STP units work in India?

The term FCL. What is FCL means

How does a Running bond work?

Travelers to India under import duty exemption, Frequently Asked Questions Part 2

Triangular shipment

Types of Insurance Documents.

Import Registration and import Licence procedures in Cyprus

How to export from India to Benin?

How to import to India from Benin?

How to Import to Benin?

How to export from Belize?

 Latest date to file GST registration in India

Procedures to obtain GST registration for non-resident taxable person

Is digital signature option available under registration of GST in India?

 Advantages of GST registration in India

Who has to obtain GST registration in India?

Does GST registration number of my firm change time to time in India?

 Is GST registration required for a public sector undertaking?

 Is amendment of GST registration allowed in India?

 Cancellation of GST registration in India

Meaning of term reversal of credit under GST

Compensation to States for loss of revenue under GST

Impact of GST on Retail Sale Traders

Meaning of term bond under GST

What is Registered Person under GST



satyabrata chakraborty: what if meaning DURANTA , swift


Discussion Forum

You can also share your thoughts about this article.
Any one can answer on question posted by Readers