Trade Compliance Team 21 Sep 2026
2 min read
Incoterms are three letter trade terms published by the International Chamber of Commerce. They define who is responsible for what between buyer and seller: transport, insurance, export and import clearance, and the point at which risk passes.
The most common terms
| Term | Seller responsible until… | Typical use |
|---|---|---|
| EXW Ex Works | Goods are made available at the seller's premises | Buyer controls the whole journey |
| FCA Free Carrier | Goods are handed to the buyer's carrier | Containerised and multimodal |
| FOB Free On Board | Goods are loaded on the vessel | Sea freight only |
| CIF Cost, Insurance & Freight | Goods arrive at destination port (insurance and freight paid) | Sea freight only |
| DAP Delivered At Place | Goods are ready for unloading at destination | Door delivery, buyer clears import |
| DDP Delivered Duty Paid | Goods are delivered and import duties are paid | Maximum seller responsibility |
Choosing the right term
- Who has better freight rates? The party with stronger carrier contracts should usually arrange transport.
- Who is better placed to clear customs? Import clearance is easier for a local party.
- How much control do you want? More control means taking on more responsibility.
If you are unsure, ask our team. We can advise on the term that fits your product, lane and risk appetite.
