Incoterms 2020: Complete Guide to International Trade Terms

What are Incoterms?

Incoterms (International Commercial Terms) are a set of standard trade terms developed by the International Chamber of Commerce to clarify the responsibilities, risks, and cost allocation between buyers and sellers during cargo transportation. The latest version is Incoterms 2020.

Key Trade Terms

• EXW - Ex Works: Buyer takes all transportation responsibilities
• FOB - Free On Board: Seller responsible for loading goods on board
• CIF - Cost Insurance and Freight: Includes cost, insurance, and freight
• CFR - Cost and Freight: Includes cost and freight only
• DDP - Delivered Duty Paid: Delivered with duty paid

Selection Advice

Choose the appropriate trade term based on your business needs and risk tolerance. For first-time exporters, DDP or CIF terms are recommended for lower risk exposure.