Incoterms or trade terms are used to define the obligations of seller and buyer in the movement of goods from one person to another. The term is used to explain which party is responsible for the costs and risks at each stage of the goods movement, according to Tate's Export Guide.
Incoterms should always be negotiated and used to provide a legally-enforceable part of the sales contact, to either avoid disputer when something goes wrong or help resolve disputes which go to litigation.
With former revisions, Incoterms could be listed in order of increasing responsibility for the seller, from EX Works to Delivery Duty Paid named place of destination. Things are not now so simple. Place of transfer from seller to buyer may not be the place of transfer or final destination.
Seven of the terms in the latest revision, including two new ones, may be used irrespective of the mode of carriage of goods. Carriage may be party, wholly or not all by sea.
The other four terms are for carriage by sea or inland waterway and the named places of delivery are all sea or freshwater ports. These are:
Use of the last three does not imply delivery as crossing a ship's rail but does mean that the goods are sitting on or in the vessel. Compliance with any Incoterm includes acting within appropriate time limits, packaging requirements and other conditions of the sales contract or normal practice.
British Jewellery & Giftware International
A Division of the British Allied Trades Federation
10 Vyse Street
Birmingham, B18 6LT, UK
Telephone: +44 (0)121 236 2657
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