Definition
Incoterms® are the International Chamber of Commerce's standard trade terms, published since 1936 and now in the 2020 edition, which has eleven rules. Each says where the seller delivers, when risk passes and who pays what — Incoterms 2020 gathers the cost allocation into articles A9/B9. The 2020 edition replaced DAT with DPU (delivered at place unloaded), set different minimum insurance for CIF (Institute Cargo Clauses C) and CIP (Clauses A), and allowed an on-board bill of lading under FCA.[1]
For ship supply the choice is practical. A maker selling spares EXW or FCA its factory leaves freight, export clearance and the in-transit routing to the owner's forwarder. DAP "agent's warehouse, Jebel Ali" puts the goods at the agent's door with import formalities still on the buyer. Local stores delivered alongside are rarely sold under Incoterms at all — the supplier's own conditions of sale define the delivery point instead.[1,2]
Whichever rule you use, name the place precisely (Incoterms rule + named place + "Incoterms 2020") and make sure it matches how the goods will travel — vessel name and "spares in transit" on the documents if they are not to be imported.[1]
Read next on GeoMarineHub
Sources
- [1] ICC — Incoterms® 2020 — https://iccwbo.org/business-solutions/incoterms-rules/incoterms-2020/
- [2] ISSA — General Conditions of Sale — https://www.shipsupply.org/conditions-of-sale/
A working definition for buyers, not legal advice — the contract, the convention text and your club or class have the last word.