Trade terms, also known as price terms, use a short concept (such as "FOB", "CIF") to describe the place of delivery, the composition of the price of the commodity and the division of responsibilities between the buyer and seller in terms of procedures, costs and risks, and determine the terms of delivery.
The trade terms have two meanings: on the one hand, the terms of delivery; On the other hand, it represents the price composition, especially the subordinate costs included in the price.
EXW Factory Delivery
Delivery is completed when the goods are delivered to the Buyer at the Seller's place of residence or other designated place (such as workshop, factory or warehouse) without the Seller completing export customs clearance or loading the goods on any means of transport.This term is the one for which the seller is least liable.
FCA Goods to carrier
It means that as long as the seller delivers the goods to the carrier designated by the buyer at the designated place and goes through the export customs clearance procedures, the delivery is completed.
It should be noted that the choice of place of delivery has an impact on the obligation to load and discharge goods at that place. The term can be used for various modes of transport, including multimodal transport.
FAS Ship-side delivery
It means that the seller delivers the goods alongside the ship at the named loading port, that is, the delivery is completed. The buyer must bear all risks of loss of or damage to the goods from that time.
FOB terminology
Refers to the name of the goods + quantity + unit price +FOB+ port of shipment. The risk transfer is when it goes over the side of the ship. As the goods did not cross the ship's rail, the liability should be borne by the seller's company.
CFR cost plus freight
It means that the seller completes the delivery of the goods over the ship's rail at the port of loading, and the seller must pay the freight and expenses required to transport the goods to the named port of destination.
However, the risk of loss of or damage to the goods after delivery, as well as any additional costs due to various events, is passed from the seller to the buyer.
The term applies only to sea or inland waterway transport. If the parties do not intend to deliver over the ship's rail, the CPT term should be used.
CIF Cost, Insurance and Freight
It means that the seller completes the delivery when the goods cross the ship's rail at the port of loading. The term applies only to sea and inland waterway transport.
If the parties do not intend to deliver over the ship's rail, the term CIP shall be used.
CPT Freight to (named destination)
It means that the seller delivers the goods to its designated carrier (the carrier), but the seller must also pay the freight to get the goods to the destination. That is, the buyer bears all risks and other costs after delivery.
CIP Freight and Insurance
It means that the seller delivers the goods to its designated international forwarder, but the seller must also pay the freight to the destination of the goods, that is, the buyer bears all the risks and additional costs of the seller after delivery.
The term can be applied to various modes of transport, including multimodal transport.
DAF Delivered at Frontier
It refers to the completion of delivery when the seller at the designated place and specific delivery point at the border, before the customs border of the neighboring country, the goods that have not yet been unloaded on the means of transport that are still in delivery are handed over to the buyer for disposal, and the customs clearance procedures for the export of the goods have been completed but the customs clearance procedures for the import have not yet been completed.
DES Delivered on board at destination
It means that at the designated port of destination, the goods are handed over to the buyer on board the ship for disposal, but the goods are not cleared for import, and the seller completes the delivery.
The term is used only when the goods are carried on board the ship at the port of destination by sea or river transport or multimodal transport.
DEQ Delivered at Quay of Destination
It means that as long as the seller delivers the goods to the carrier designated by the buyer at the designated place and goes through the export customs clearance procedures, the delivery is completed.
It should be noted that the choice of place of delivery has an impact on the obligation to load and discharge goods at that place. The term can be used for various modes of transport, including multimodal transport.
DDU Delivered Duty Unpaid
DDU delivery without duty means that the seller gives the goods to the buyer at the designated destination, without import formalities, and without unloading the goods from the delivery vehicle, that is, the delivery is completed.
DDP Delivered Duty Paid
DDP delivery after tax means that the seller has completed the import customs clearance procedures at the designated destination, and will deliver the goods that have not yet been unloaded on the delivery vehicle to the buyer to complete the delivery.
