Delivery Terms
EXW - Ex Works
"Ex Works" means that the seller fulfils
his obligation to deliver when he has
made the goods available at his premises (i.e. works, factory, warehouse,
etc.) to the buyer. In particular, he
is not responsible for loading the goods
on the vehicle provided by the buyer or
for clearing the goods for export,
unless otherwise agreed.
This term thus represents the minimum obligation for the seller. The buyer
bears all cost and risks involved in
taking the goods from the seller's
premises to the desired destination.
This term should not be used when
the buyer cannot carry out directly or
indirectly the export formalities. In su
ch circumstances, the FCA term should
be used.
FCA - Free Carrier
"Free Carrier" means that the seller fu
lfils his obligation to deliver when he
has handed over the goods, cleared for e
xport, into the carrier named by the
buyer at the named place or point. If
no precise point is indicated by the
buyer, the seller may chose within the
place or range stipulated where the
carrier shall take the goo
ds into his charge. When according to commercial
practice, the seller's assistance is requ
ired in making the contract with the
carrier (such as in rail or
air transport) the seller
may act at the buyer's risk
and expense.
This term may be used for any mode of transport, including multimodal transport.
FAS - Free Alongside Ship
"Free Alongside Ship" means that the se
ller fulfils his obligation to deliver
when the goods have been placed al
ongside the vessel on the quay or in
lighters at the named port of shipment
. This means that the buyer has to
bear all costs and risks of loss of or
damage to the goods from that moment.
The FAS term requires the buyer to clea
r the goods for export. It should not
be used when the buyer cannot carry out
directly or indi
rectly the export
formalities.
This term can only be used for s
ea or inland waterway transport.
FOB - Free On Board
"Free On Board" means that the seller fulfils his obligation to deliver when
the goods have passed over the ship's rail
at the named port of shipment. This
means that the buyer has to bear all cost
s and risks of loss of or damage to
the goods from that point. The FOB term
requires the seller to clear the
goods for export.
This term can only be used for sea or
inland waterway transport. When the
ship's rail serves no practical purpose, su
ch as in the case of roll-on/roll-off
or container traffic, the FCA term
is more appropriate to use.
CFR - Cost and Freight
"Cost and Freight" means that the seller
must pay the costs and freight
necessary to bring the goods
to the named port of des
tination but the risk of
loss of or damage to the goods, as well as any additional costs due to events
occurring after the time the goods have
been delivered on board the vessel, is
transferred from the seller
to the buyer when the goods pass the ship's rail in
the port of shipment. The CFR term requi
res the seller to
clear the goods for
export.
This term can only be used for sea an
d inland waterway transport. When the
ship's rail serves no practical purpose, such
as in the case of roll-on/roll- off
or container traffic, the CPT term
is more appropriate to use.
CIF - Cost, Insurance and Freight
"Cost, Insurance and Freight" means that
the seller has the same obligations
as under CFR but with the addition that
he has to procure marine insurance
against the buyer's risk of loss of or
damage to the goods during the carriage.
The seller contracts for insurance
and pays the insurance premium.
The buyer should note that under the CIF term
the seller is only required to
obtain insurance on minimum coverage. Th
e CIF term requires the seller to
clear the goods of export.
This term can only be used for sea an
d inland waterway transport. When the
ship's rail serves no practical purpose, such
as in the case of roll-on/roll- off
or container traffic, the CIP term
is more appropriate to use.
CPT - Carriage Paid To
"Carriage Paid To" means th
at the seller pays the fr
eight for the carriage of
the goods to the named destination. The ri
sk of lose of or damaged to the
goods, as well as any additional costs due to events occur after the time
the goods have been delivered to the carri
er, is transferred from the seller to
the buyer when the goods have been delivered to the custody of the carrier.
"Carrier' means any person who, in a c
ontract of carriage, undertakes to
perform or to procure the performance
of carriage, by rail, road, sea, air,
inland waterway nor by a combination of such modes. If subsequent carriers
are used for the carriage to the agreed
destination, the risk passes when the
goods have been delivered to the firs
t carrier. The CPT term requires the
seller to clear the goods for export.
This term may be used for any mode of transport including multimodal
transport.
CIP - Carriage and Insurance Paid to
"Carriage and Insurance Paid to" m
eans that the seller has the same
obligations as under CPT but with the a
ddition that the seller has to procure
cargo insurance against the buyer's risk
of loss of or damage to the goods
during the carriage. The seller contract
s for insurance and pays the insurance
premium. The buyer should note that unde
r the CIP term the seller is only
required to obtain insurance on mini
mum coverage. The CIP term requires
the seller to clear th
e goods for export.
This term may be used for any mode of transport including multimodal
transport.
DAF - Delivered At Frontier
"Delivered At Frontier" m
eans that the seller fulfils his obligation to deliver
when the goods have been made available, cleared for export, at the named
point and place at the frontier, but before the customs border of the
adjoining country. The term 'frontier'
may by used for any frontier including
that of the country of export. Therefor
e, it is of vital importance that the
frontier in question be defined prec
isely by always naming the point and
place in the term.
The term is primarily intended to be
used when goods are to be carried by
rail or road, but it may be used
for any mode of transport including
multimodal transport.
DES - Delivered Ex Ship
"Delivered Ex Ship" means that the se
ller fulfils his obligation to deliver
when the goods have been made availa
ble to the buyer on bo
ard the ship not
cleared for import at the na
med port of destination. The
seller has to bear all
the costs and risks involved in bri
nging the goods to the named port of
destination.
This term can only be used for s
ea or inland waterway transport.
DEQ - Delivered Ex Quay
"Delivered Ex Quay (duty Paid)" means
that the seller fulfils his obligation
to deliver when the goods have been
made available to the buyer on the quay
(wharf) at the named port of destinat
ion, cleared for importation. The seller
has to bear all risks including duties,
taxes and other ch
arges of delivering
the goods thereto. This term should not be
used if the seller is unable directly
or indirectly to obtain the import license.
If the parties wish the buyer to clear the goods for importation and pay the
duty the words 'duty unpaid" should be used instead of 'duty paid".
If the parties wish to exclude from the
seller's obligations some of the costs
payable upon importation of the goods (suc
h as value added tax (VAT), this
should be made clear by adding words to
this effect : "Delivered ex quay,
VAT unpaid ( ... named port of destination)".
This term can only be used for s
ea or inland waterway transport.
DDU - Delivered Duty Unpaid
"Delivered Duty Unpaid" means that
the seller fulfils his obligation to
deliver when the goods have been made available to the named place in the
country of importation. The seller has to
bear the costs and risks involved in
bringing the goods thereto (excluding dutie
s, taxes and other official charges
payable upon importation) as well as
the costs and risks of carrying out
customs formalities. The buyer has to pay any additional costs and to bear
any risks caused by his failure to
clear the goods for import in time.
If the parties wish the seller to carry out customs formalities and bear the
costs and risks resulting there from,
this has to be made clear by adding
words to this effect. If the parties wish to include in the seller's obligations
some of the costs payable upon import
ation of the goods (such as value
added tax (VAT), this should be made
clear by adding words to this effect:
"Delivered duty unpaid, VAT paid, ( ... named place of destination)".
This term may be used irrespec
tive of the mode of transport.
DDP - Delivered Duty Paid
"Delivered Duty Paid" means that the se
ller fulfils his obligation to deliver
when the goods have been made availabl
e to the named place in the country
of importation. The seller has to bear
the risks and costs, including duties,
taxes and other charges of deliver
ing the goods there to cleared for
importation. Whilst the EXW term represents the minimum obligation for
the seller, DDP represents the maximum obligation.
This term should not be used if the selle
r is unable directly
or indirectly to
obtain the import license.
If the parties wish the buyer to clea
r the good for importation and to pay the
duty, the term DDU should be used. If
the parties wish to exclude from the
seller's obligations some of the co
sts payable upon importation of the goods
(such as value added tax (VAT), this
should be made clear by adding words
to this effect: "Delivered duty
paid, VAT paid, ( ... named place of
destination)".
This term may be used irrespec
tive of the mode of transport.