INCOTERMS

Questions and answers about INCOTERMS

  • VENDOR INSISTING ON EXW TERMS

    We have an export scenario from Spain to Chile in which the vendor requested the purchase be made under EXW INCOTERMS.  We are  handling and paying for the transportation and logistics and choosing the Spanish freight forwarder. We advised our internal procurement and sourcing teams as well as the Spanish vendor that we need to […]

  • Incoterms (Risk Versus Insurance)

    QUESTION: Who is responsible if there is a mishap during transport when transfer of risk indicates the seller, but insurance is “negotiable”, and we have insurance? Case in point: We buy from a foreign seller with terms DAP buyer’s ( our) warehouse. According to DAP, insurance is negotiable. So normally if something occurs, seller is […]

  • Demurrage CIP

    QUESTION: Incoterm ICC Book conflicts with published Incoterms online. Order CIP to inland destination city of TUMELTSHAM. Demurrage charged.  Unknown reason.  Could be customer appointment. Who pays demurrage? ICC book shows Buyer. Customer protesting. **************** Answers: CIP is one of the Incoterms where the responsibility for risk and responsibility for costs transfer at different points in […]

  • Incoterms

    QUESTION: I have a scenario that goes like this: The buyer wants the seller to own the goods until it hits the buyers warehouse in the US. The buyer wants to handle the shipping, import clearance and transportation delivery. The buyer wants the seller to take out insurance on the goods in transit as they […]

  • PREPAY AND ADD FREIGHT TERMS

    QUESTION: If a customer initially places an order under FCA (Collect) terms but then circumstances dictate a change to arrangements and the seller ends up contracting the carriage and agreeing to subsequently bill the seller for freight, does this change the terms? My understanding is that the term is based on whoever makes the contract […]

  • INCOTERMS AND RISK

    QUESTION: Asking for a friend… We see purchase orders, invoices, and even agreements where the incoterm stated does not align with the transfer of risk. Many of these agreements are intended with the shipper to deliver to the buyer’s final warehouse location by arranging door to door transportation, but risk to transfer outside the importing […]

  • CORRECT INCOTERM FOR THIS SCENARIO

    QUESTION: Can the membership advise who should be listed as the USPPI in the following scenario? US company A sells goods to US company B basis FOB Incoterms®; company A loads the goods onto a vessel at a US export port. Company B arranges the vessel freight for onward movement to foreign destination for further […]

  • Incoterms for Border Delivery

    QUESTION: Recommendation for Incoterms for DELIVERY at the border?  Intent is for a foreign entity to not own goods in the US, MX, or CA due to tax consequences.  Seller A in Foreign Country A buys goods from Foreign Country B and manufactured by MX supplier B.  B is non-related.  A sells to related parties […]

  • Incoterms for Domestic

    QUESTION: What incoterm does the membership recommend or works best for US- domestic transactions for freight collect/seller door pickup or freight prepaid/ship to buyer’s address? I’m seeing a lot of contracts written for “US” and its territories as DDP or DAP or EXW.  If freight collect, why EXW versus FCA?  EXW means the buyer’s carrier […]

  • DAP and demurrage

    QUESTION: Here’s a question for our Incoterms experts.  We had a shipment from the US to MX, and the Incoterm was DAP-customer’s door.  Under DAP terms, the buyer is responsible for the customs clearance.  However, the buyer’s broker took a very long time to perform the clearance, racking up high demurrage costs.  Who is responsible […]

  • INCOTERM training

    QUESTION: Where does the responsibility for INCOTERM Training fall in most companies – logistics, procurement, sourcing, legal or trade compliance? I assume procurement/sourcing because they are the dept that negotiates the terms of sale, pricing etc.   I could see logistics but the logistics team really just follows the INCOTERM language in the agreement when it […]

  • FOB/FCA SHIPPERS LETTER OF INSTRUCTIONS

    QUESTION: We export product from Canada and the US to various markets globally. In the cases of those with FCA or FOB origin port (in North America), where the customer makes their own ocean bookings and we deliver to the port based on that booking, who is responsible for the shippers letter of instruction or […]