QUESTION: How do we calculate CIF value if we’re shipping under our global insurance policy (not insurance specifically obtained for the shipment at hand)? What’s the value of the insurance? A percentage of the premium? A percentage of the shipment value? =========== Answer: You would need to work with your finance and cost accounting team […]
QUESTION: Before you respond, This is more of an academic question for those interested to better understand and learn about trade and logistics. I know the intended meaning of the phrase “free domicile” – the exporter/shipper in the exporting country is responsible for all transportation and other charges for the goods in the country of […]
QUESTION: Under DDP terms, can you request an Entry packet from the supplier that is handling your company’s import? ========== Answers: You can request anything you want. If the terms are DDP, and you are not the IOR, it is not “your company’s import.” You are merely the consignee, and have no responsibility for the […]
QUESTION: We sold a piece of used heavy equipment to a customer in St. Maarten on an ExWorks basis in May. Turns out the item has a blown engine, is unfixable, and we have already credited the customer for the cost of the machinery. From a compliance standpoint can we sell the equipment in St. […]
QUESTION: We have written agreements specifying the opposite of the incoterm. For example, an export will be under CFR and the written agreement will state risk of loss transfers at the destination port. If there were an issue, what do we go by, the incoterm or written agreement? ************** Answers: Legal contract supersedes INCO Terms. […]
QUESTION: We have divisions who ship direct to customer through e-commerce websites. Orders shipped are usually anywhere from $10 to $100, or more, depending what is being purchased by the customer, e.g. one month supply of coffee or candy. What are the proper Incoterms when shipping from the US to US customers, Canada, Mexico, or […]
QUESTION: Our company does business with about 16 different foreign suppliers in Thailand, Korea, China, and Taiwan. Almost all of our purchases are made with these foreign suppliers using ex-works as the incoterm. Under this incoterm our company assumes the responsibility for the export declarations. We’re concerned that utilizing this term exposes our company to some […]
QUESTION: Executive Team at our company proposed to change Incoterms to CIP (with exception of carriage) named place of destination. According to their statement: under this Incoterm, the supplier is responsible for all charges to get freight on board a conveyance and holds title and risk to the point of destination. We are the buyer […]
QUESTION: We are a USA importer purchasing widgets from China. For this vendor we use a unique/hybrid sales terms model in which the costs are different than risks. The seller manages all freight, customs and delivery to our USA warehouse and incurs the international freight and USA Customs duties costs from their forwarder. After the […]
QUESTION: With the implementation of ASC 606 the standard for recognizing revenue has changed from “risk of loss” or “title transfer” to when “the customer obtains control of that asset”. As a result, while shipping terms play a role in determining when to recognize revenue they are only one consideration. Right now revenue recognition in […]
OT Fact Sheet: Origin Certification Requirements QUESTION: Hi INCOTERMS experts. We are negotiating a DAP INCOTERM for an import with the named place being our final destination warehouse. The seller is adding the following language: “Expenses at the airport, borne by the importer” I can understand why they might want to add this – if […]
OT Fact Sheet: Origin Certification Requirements QUESTION: I’m being asked to provide an incoterm solution that allows the shipper to retain the responsibility, shipping cost, and in-transit risk, while allowing the title to transfer once the product is shipped. Essentially what we are looking for DAP (Shippers Facility for purposes of title transfer). I’m not […]
