Trade Terms Definitions (on Manage Defaults/Customs Clearance)
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EXW
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Ex Works
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Means that the seller delivers the goods to the buyer when it places the goods at the disposal of the buyer at a named place (like a factory or warehouse), and that named place may or may not be the seller’s premises. For delivery to occur, the seller does not need to load the goods on any collecting vehicle, nor does it need to clear the goods for export, where such clearance is applicable. |
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FCA
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Free Carrier
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Means that the seller delivers the goods to the buyer in one or other of two ways:
Whichever of the two is chosen as the place of delivery, that place identifies where risk transfers to the buyer and the time from which costs are for the buyer’s account. |
CPT
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Carriage Paid To
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Means that the seller delivers the goods – and transfers the risk - to the buyer by handing them over to the carrier contracted by the seller or by procuring the goods so delivered. The seller may do so by giving the carrier physical possession of the goods in the manner and at the place appropriate to the means of transport used. Once the goods have been delivered to the buyer in this way, the seller does not guarantee that the goods will reach the place of destination in sound condition, in the stated quantity or indeed at all. This is because risk transfers from seller to buyer when the goods are delivered to the buyer by handing them over to the carrier; the seller must nonetheless contract for the carriage of the goods from delivery to the agreed destination.
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CIP
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Carriage and Insurance Paid To
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Means that the seller delivers the goods – and transfers the risk - to the buyer by handing them over to the carrier contracted by the seller or by procuring the goods so delivered. The seller may do so by giving the carrier physical possession of the goods in the manner and at the place appropriate to the means of transport used. Once the goods have been delivered to the buyer in this way, the seller does not guarantee that the goods will reach the place of destination in sound condition, in the stated quantity or indeed at all. This is because risk transfers from seller to buyer when the goods are delivered to the buyer by handing them over to the carrier; the seller must nonetheless contract for the carriage of the goods from delivery to the agreed destination.
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DPU
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Delivered at Place Unloaded
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Means that the seller delivers the goods – and transfers risk - to the buyer when the goods, once unloaded from the arriving means of transport, are placed at the disposal of the buyer at a named place of destination or at the agreed point within that place, if any such point is agreed. The seller bears all risks involved in bringing the goods to and unloading them at the named place of destination. In this Incoterms rule, therefore, the delivery and arrival at destination are the same. DPU is the only Incoterms rule that requires the seller to unload goods at destination. The seller should therefore ensure that it is in a position to organize unloading at the named place. Should the parties intend the seller not to bear the risk and cost of unloading, the DPU rule should be avoided and DAP should be used instead.
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DAP
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Delivered at Place
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Means that the seller delivers the goods – and transfers risk - to the buyer when the goods are placed at the disposal of the buyer on the arriving means of transport ready for unloading at the named place of destination or at the agreed point within that place, if any such point is agreed. The seller bears all risks involved in bringing the goods to the named place of destination or to the agreed point within that place. In this Incoterms rule, therefore, delivery and arrival at destination are the same.
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DDP
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Delivered Duty Paid
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Means that the seller delivers the goods to the buyer when the goods are placed at the disposal of the buyer, cleared for import, on the arriving means of transport, ready for unloading, at the named place of destination or at the agreed point within that place, if any such point is agreed. The seller bears all risks involved in bringing the goods to the named place of destination or to the agreed point within that place. In this Incoterms rule, therefore, delivery and arrival at destination are the same.
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There are four terms in this category:
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FAS (Free Alongside Ship)
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FOB (Free on Board)
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CFR (Cost and Freight)
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CIF (Cost, Insurance, Freight)
These terms are listed for your information only as they are not needed when sending shipments with DHL Express.
Incoterms® Definition
EXW | Ex Works | The seller's only obligation is to make the goods available at its premises or at another named place (works, factory, warehouse, etc.). The buyer bears all costs and risks involved in taking the goods from the seller’s premises to the desired destination. This term represents the minimum obligation for the seller. |
FCA | Free Carrier | The seller’s obligation is to hand over the goods, cleared for export, into the charge of the carrier named by the buyer at the named place or point. The parties are advised to specify as clearly as possible the point within the named place of delivery, as the risk passes to the buyer at that point. |
CPT | Carriage Paid To | The seller pays the freight for the delivery of goods to the carrier or to another person nominated by the seller at the named destination. Once delivered, the risk of loss or damage to the goods is transferred from the seller to the buyer. This term requires the seller to clear the goods for export. |
CIP | Carriage and Insurance Paid To | The seller has the same obligations as under CPT but has the responsibility of obtaining insurance against the buyer’s risk of loss or damage to goods during carriage. Insurance only needs to be obtained at minimum coverage and the seller is required to clear the goods for export. |
DPU | Delivered At Place Unloaded | The seller delivers the goods and transfers risk to the buyer when the goods, once unloaded from the arriving means of transport, are placed at the disposal of the buyer at a named place of destination or at the agreed point within that place, if any such point is agreed. The seller bears all risks involved in bringing the goods to and unloading them at the named place of destination. In this Incoterms rule, therefore, the delivery and arrival at destination are the same. DPU is the only Incoterms rule that requires the seller to unload goods at destination. The seller should therefore ensure that it is in a position to organize unloading at the named place. Should the parties intend the seller not to bear the risk and cost of unloading, the DPU rule should be avoided and DAP should be used instead. |
DAP | Delivered At Place | The seller delivers when the goods are placed at the disposal of the buyer on the arriving means of transport ready for unloading at the named place of destination. The seller is required to clear the goods for export and the importer is responsible for effecting customs clearance, and paying any customs duties. |
DDP | Delivered Duty Paid | The seller is responsible for delivering the goods to the named place in the country of importation, including all costs and risks in bringing the goods to import destination. This includes all export and import duties, taxes and customs formalities. |