What are Incoterms?
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- by MI September 11, 2025
Types of Incoterms 2020
Incoterms are divided into two main categories:
- Any mode of transport
- Sea & inland waterway transport only
1. Incoterms for Any Mode of Transport
EXW – Ex Works
- Seller makes goods available at their premises.
- Buyer handles everything else: transport, customs, risk.
FCA – Free Carrier
- Seller delivers goods to a carrier chosen by the buyer.
- Risk passes once goods are handed over.
CPT – Carriage Paid To
- Seller pays for transport up to a destination.
- Risk transfers when goods are handed to the carrier.
CIP – Carriage and Insurance Paid To
- Same as CPT, but seller also arranges insurance.
DAP – Delivered at Place
- Seller delivers goods to buyer’s location.
- Buyer handles import customs/duties.
DPU – Delivered at Place Unloaded
- Seller delivers and unloads goods at buyer’s location.
DDP – Delivered Duty Paid
- Seller handles everything: shipping, customs, insurance, duties.
- Buyer just receives goods.
🚢 2. Incoterms for Sea & Inland Waterway Transport
FAS – Free Alongside Ship
- Seller delivers goods next to ship at port.
- Buyer loads onto vessel & handles shipping.
FOB – Free On Board
- Seller loads goods onto ship.
- Risk passes once goods are onboard.
CFR – Cost and Freight
- Seller pays freight to destination port.
- Buyer takes risk once goods are onboard.
CIF – Cost, Insurance & Freight
- Same as CFR, but seller also provides insurance.
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