Incoterms
In international trade, there are certain " Delivery Methods" that determine where the goods will be delivered, who will cover the costs or how they will be shared, whether insurance and transportation contracts will be made or not.
These;
EXW - Ex Works (Delivery at Work)
The seller keeps the goods ready for the buyer' s order on the previously determined date in his facility and notifies the buyer. The buyer receives the goods from the business, prepares the necessary documents for export, completes the customs procedures and imports the goods to his own country. From the time the goods are delivered to the facility, all costs and risks related to the goods are borne by the buyer.
FCA – Free Carrier (Free Carrier)
The seller completes the delivery process when he completes the customs procedures and transfers the goods to the supervision of the first carrier on the specified date and place. From this moment on, all costs and risks related to the goods pass to the buyer. Freight fee is paid by the buyer like all other expenses.
CPT – Carriage Paid To
The seller is obliged to pay the freight fee to the destination. From the moment the goods are transferred to the custody of the first carrier, all risks and expenses other than freight pass to the buyer.
CIP – Carriage And Insurance Paid To
The seller has the same obligations as in CPT. However, in addition, cargo insurance must be obtained against the risk of loss or damage during the transportation of the goods.
DAT – Delivered At Terminal: The
goods are left at the disposal of the buyer at the terminal point determined by the buyer and the seller (this point may be a port, customs warehouse or the buyer' s factory), with the unloading costs covered by the seller. All customs procedures, expenses, taxes, duties and charges arising from customs are the responsibility of the buyer.
DAP – Delivered At Place (Delivered At Place)
It is the delivery of the goods to the buyer' s order on the transportation vehicle ready for unloading at the unloading place determined by the buyer and the seller (a port pier, customs point, airport). All customs procedures, expenses, taxes, duties and charges arising from customs are the responsibility of the buyer. The seller bears the costs of transporting the goods to the specified location / risks of terminal-related damage.
DDP – Delivered Duty Paid
The seller prepares the goods in accordance with the contract conditions. It prepares the necessary documents to be used in its own country and the Buyer' s country. Completes Export and Import Customs procedures. The carrier provides the vehicle and pays the freight fee. All costs and risks related to the goods until delivery belong to the seller. The delivery is made at the place and date determined in the buyer' s country, by paying the customs duties.
The buyer pays the cost of the goods and receives the goods in accordance with the contract conditions.
B) Rules specific to sea and inland water transportation
FAS – Free Alongside Ship
The seller' s delivery obligation ends when the goods are placed on the dock or barge in line with the ship at the designated port. Loading, unloading, transportation and insurance costs of the goods are paid by the buyer.
FOB – Free on Board (Free on Board)
The seller loads the goods onto the ship provided by the buyer at the specified date and place. Any damage, loss and expenses that may occur after the goods pass to the ship' s rail (deck) are the responsibility of the Buyer. The seller prepares all the documents required for export, completes the customs procedures and delivers the goods.
CFR – Cost and Freight
The seller bears all costs and risks and brings the goods to the port where they will be loaded. It carries out the customs procedures and carries out the loading by paying the freight fee. From this moment on, all costs and risks related to the goods other than freight belong to the buyer.
CIF – Cost, Insurance and Freight:
The seller bears the insurance premium, freight and loading costs and risks and brings the goods to the port where they will be loaded. The seller makes an agreement with the shipping agency and supplies it. It informs the buyer that the goods in the sales contract have been loaded on the date and place specified. By paying the insurance premium, the seller obtains the narrowest comprehensive marine transportation insurance appropriate to the type of goods he loads. After the goods are loaded onto the ship, costs and risks other than freight and insurance premium pass to the buyer.