📦 Trade Communication

Incoterms 2020 Quick Reference

Responsibility matrix of all 11 terms. All calculations run locally in your browser — free, instant and private.

💡 Note: Incoterms 2020 added an on-board B/L mechanism for FCA and replaced DAT with DPU. For containers, prefer FCA/CIP over FOB/CIF.

EXWEx Works

Seller makes goods available at their premises

Delivery point	Seller’s premises
Risk transfer	When buyer picks up
Export clearance	Buyer
Main freight	Buyer
Import clearance	Buyer
Insurance	Buyer (no seller obligation)
Transport mode	Any mode(s) of transport
Best for	Buyer-arranged pickup

FCAFree Carrier

Seller delivers to the buyer’s nominated carrier at a named place

Delivery point	Named place
Risk transfer	On handover to carrier
Export clearance	Seller
Main freight	Buyer
Import clearance	Buyer
Insurance	Buyer (no seller obligation)
Transport mode	Any mode(s) of transport
Best for	Recommended for containerized cargo

FASFree Alongside Ship

Seller places goods alongside the vessel at the port of shipment

Delivery point	Alongside ship
Risk transfer	Once alongside the vessel
Export clearance	Seller
Main freight	Buyer
Import clearance	Buyer
Insurance	Buyer (no seller obligation)
Transport mode	Sea/inland waterway only
Best for	Bulk and non-containerized sea freight

FOBFree On Board

Seller loads goods on board the vessel nominated by the buyer

Delivery point	On board vessel
Risk transfer	Once on board
Export clearance	Seller
Main freight	Buyer
Import clearance	Buyer
Insurance	Buyer (no seller obligation)
Transport mode	Sea/inland waterway only
Best for	Traditional sea freight (use FCA for containers)

CFRCost and Freight

Seller pays freight to destination port; risk transfers on loading

Delivery point	On board vessel
Risk transfer	Once on board
Export clearance	Seller
Main freight	Seller
Import clearance	Buyer
Insurance	Buyer (no seller obligation)
Transport mode	Sea/inland waterway only
Best for	Seller-controlled sea freight

CIFCost, Insurance and Freight

Like CFR plus seller-provided insurance at 110% of CIF value

Delivery point	On board vessel
Risk transfer	Once on board
Export clearance	Seller
Main freight	Seller
Import clearance	Buyer
Insurance	Seller (recommended)
Transport mode	Sea/inland waterway only
Best for	L/C-settled sea trade

CPTCarriage Paid To

Seller pays freight to named destination; risk transfers to first carrier

Delivery point	First carrier
Risk transfer	On handover to carrier
Export clearance	Seller
Main freight	Seller
Import clearance	Buyer
Insurance	Buyer (no seller obligation)
Transport mode	Any mode(s) of transport
Best for	Air/multimodal (alternative to CFR)

CIPCarriage and Insurance Paid To

Like CIP plus seller-provided all-risks insurance

Delivery point	First carrier
Risk transfer	On handover to carrier
Export clearance	Seller
Main freight	Seller
Import clearance	Buyer
Insurance	Seller (recommended)
Transport mode	Any mode(s) of transport
Best for	Air/multimodal (alternative to CIF)

DAPDelivered At Place

Seller delivers at named destination, ready for unloading

Delivery point	Named destination
Risk transfer	On arrival, before unloading
Export clearance	Seller
Main freight	Seller
Import clearance	Buyer
Insurance	Seller (recommended)
Transport mode	Any mode(s) of transport
Best for	Alternative to DDP when buyer clears customs

DPUDelivered at Place Unloaded

The only term requiring the seller to unload

Delivery point	Named destination, unloaded
Risk transfer	After unloading
Export clearance	Seller
Main freight	Seller
Import clearance	Buyer
Insurance	Seller (recommended)
Transport mode	Any mode(s) of transport
Best for	Seller-unloaded warehouse delivery

DDPDelivered Duty Paid

Seller bears all costs and risks including import duty

Delivery point	Named destination
Risk transfer	On arrival after clearance
Export clearance	Seller
Main freight	Seller
Import clearance	Seller
Insurance	Seller (recommended)
Transport mode	Any mode(s) of transport
Best for	Maximum seller obligation (common for Amazon FBA)

📖 Incoterms Guide

Choosing among the 11 Incoterms 2020 rules

Incoterms, published by the ICC, allocate responsibilities, risks and costs between buyer and seller. The 11 rules, ordered by increasing seller obligation: EXW → FCA → FAS → FOB → CFR → CIF → CPT → CIP → DAP → DPU → DDP. Choosing a term is choosing who controls logistics and who carries the risk.

Two golden rules: for containerized cargo prefer FCA/CIP over FOB/CIF (risk should transfer on handover to the carrier, not on loading); DDP makes the seller the importer of record — fine for Amazon FBA head-haul, dangerous when selling to traders without a local entity.

FOB vs CIF — the real difference

Both transfer risk when goods are on board; CIF merely adds freight and insurance paid by the seller. CIF is not "delivered" — the minimum insurance (ICC C at 110% of CIF) is symbolic. Always state the term with a named place: "FOB Shanghai, Incoterms 2020".

❓ FAQ

Is EXW the easiest term for sellers?

It shifts export clearance to the buyer, who usually cannot clear customs in your country — in practice it often becomes FCA. Avoid quoting EXW to overseas buyers.

DDP or DAP?

DDP includes import duty and clearance by the seller; DAP leaves them to the buyer. For US DDP you need an EIN as importer of record — high risk without a US entity.

Why is CIP insurance better than CIF?

Incoterms 2020 requires all-risks ICC (A) cover under CIP, while CIF still defaults to the minimal ICC (C).