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INCO TERMS

Inco terms are worldwide accepted commercial terms that defines the respective roles of the buyer as well as of the seller in arrangement of the transportation and other responsibilities and it also clarifies when the ownership of the merchandise takes place. These incoterms are used in conjunction with a sales contract or other method of transacting the deal.

The following are the Incoterms 2000 which are generally used

1. Origin Terms

The title and risk passes on to the buyer including the payment of all transportation and insurance cost from the seller’s point. It can be used for any mode of transport.

3. International Carriage Paid by the Seller

  •  CFR (Cost and Freight)

The title, risk and the insurance cost passes on to the buyer if delivered on board the ship by seller who paid the transportation cost to the destination point. It is only used for sea or inland waterway transportation.

  • CIF (Cost, Insurance and Freight)

The title and risk passes on to the buyer if delivered on board the ship by the seller who paid the transportation and insurance cost to the destination port. It is used for sea or inland waterway transportation.

  • CPT (Carriage Paid To)

The title, risk and insurance cost passes to the buyer if the goods delivered to carrier by the seller who pays transportation cost to the destination. It can be used for any mode of transportation.

  • CIP (Carriage and Insurance Paid To)

The title and risk passes to the buyer if the goods are delivered to carrier by the seller and he pays transportation and insurance cost to destination. It can be used for any mode of transportation.

 

4. International Carriage Not Paid by the Seller

  • FCA (Free Carrier)

The title and risk passes on to the buyer including the transportation and insurance cost if the seller delivers the goods cleared for export to the carrier. In this case the seller is obligated to load the goods on the buyer’s collecting vehicle but it is the buyer’s obligation to receive the seller’s arriving vehicle unloaded.

  • FAS (Free Alongside Ship)

The title and risk passes on to the buyer, included the transportation and insurance payment, once the goods delivered alongside shipby the seller. It is only used for the sea or inland waterway transportation and the export clearance obligation rests with the seller.

  • FOB (Free On Board)
In FOB the risk passes to buyer, included the transportation and insurance payment, once delivered on board the ship by the seller. It is only used for sea or inland waterway transportation.

 

The below table shows the weights and dimensions of the three most common types of containers worldwide. The weights and dimensions quoted below are averages, different manufacture series of the same type of container may vary slightly in actual size and weight.

20' container 40' container 45' high-cube container imperial metric imperial metric imperial metric

length  20′ 6.058 m       40′ 0″  12.192 m   45′ 0″ 13.716 m

width   8′ 0″  2.438 m   8′ 0″     2.438 m      8′ 0″  2.438 m

2.Arrival At Stated Destination

  • DAF (Delivered at Frontier)

The title, risk and responsibility for the import clearance passes on to the buyer if the goods are delivered to named border point by the seller. It can be used for any mood of transportation.

  •  DES (Delivered Ex Ship)

The title, risk, responsibility for the vessel discharge and the import clearance passes on to the buyer when the seller delivers it on board the ship to destination port. It is used for sea or inland waterway transportation.

  • DEQ (Delivered Ex Quay – Duty Paid)

The title and risk passes to the buyer if the goods are delivered on board the ship at the destination point by the seller who on his part delivers the goods on dock at the destination point cleared for import. It is used for sea or inland waterway transportation.

  • DDU (Delivered Duty Unpaid)

The title, risk and responsibility of the import clearance passes on to the buyer if the seller delivers the goods to named destination point. It can be used for any mode of transportation. Here the buyer is obligated for import clearance.

  • DDP (Delivered Duty Paid)

The title and risk passes on to the buyer when the seller delivers the goods to the named destination point cleared for the import. It is also used for any mode of transportation.

 

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