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INCOTERMS2010

American Institute for International Steel WebinarJanuary 14, 2011Presenters: Mary Jo Muoio, OHL

Diane Raffle, OHLModerator: Steven W. Baker, Esq.

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What INCOTERMSare not:

Terms of Sale or Passage of Title

Legally required

Universal or exclusive

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What INCOTERMSare:

Privately developed by the ICC

Internationally understood

Different than UCC or otherterminologies

Shipping terms

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INCOTERMSShould be Identified

Cite specifically

By version

Clearly spell out any

modifications or variations

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Incoterms 2010

Series of internationally-recognized,standardized trade terms publishedby the International Chamber of

Commerce INternational COmmercial TERMS

Used for international and domestictransactions

Accepted by governments, legalauthorities, and business

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On sale now!

Published in bookformat availablefrom the ICC at:

www.iccbooks.com

Incoterms 2010

By the

International Chamber of Commerce(ICC)

ICC Publication No.7152010 Edition

http://www.iccbooks.com/http://www.iccbooks.com/

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Also available as an attractive wallhanging. Suitable for framing!

Incoterms2010 Wallchart

InternationalChamber ofCommerce (ICC)

ICC Publication No.

716 , 2010 Edition

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Practical Impact of Change

New terms were effective

January 1, 2011

Old terms may apply to previouslyissued contracts

Make any necessary changes tostandard contract language and forms

Inform colleagues

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ChangesThe Basics

Documentation requirements can bemet with equivalent electronicrecords

Provides for security-relatedrequirements

Specifically addresses responsibility

for terminal handling charges

Allows for sellers in-transit sales toprocure goods shipped

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ChangesThe Terms

Simplification

Four categories reduced to two

13 terms consolidated to 11

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Incoterms 2000That was Then

EXW Ex Works FCA Free Carrier FAS Free Alongside Ship FOB Free On Board

CRF Cost And Freight CIF Cost, Insurance and Freight CPT Carriage Paid To CIP Carriage and Insurance Paid To DAF Delivered at Frontier

DES Delivered EX Ship DEQ Delivered EX Quay DDU Delivered Duty Unpaid DDP Delivered Duty Paid

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Incoterms 2010This is Now

EXW Ex Works FCA Free Carrier FAS Free Alongside Ship

FOB Free On Board CFR Cost and Freight CIF Cost, Insurance and Freight CPT Carriage Paid To CIP Carriage and Insurance Paid To DAT Delivered at Terminal DAP Delivered at Place DDP Delivered Duty Paid

I t USED FOR ALL MODES

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Incoterms USED FOR ALL MODESOF TRANSPORTATION

EX Ex Works

FCA Free Carrier

CPT Carriage Paid To

CIP Carriage and Insurance Paid To

DAT Delivered at Terminal

DAP Delivered at Place

DDP Delivered Duty Paid

Incote ms 2010 USED ONLY FOR

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Incoterms 2010 USED ONLY FORMARINE

FAS Free Alongside Ship

FOB Free On Board

CFR Cost and Freight CIF Cost, Insurance and Freight

EX WORKS (EXW)

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EX WORKS (EXW)(named place)

Named place is where the shipmentoriginates usually the sellers premises

Seller must have goods available and

packaged when promised Buyer must arrange pre-carriage, export

clearance, main carriage, import clearanceand on carriage

Neither party is required to insure

Transport Mode: All

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Free Carrier (FCA)(named place)

Named place is either the place where theshipment originates such as the sellerspremises or another place agreed withinthe sellers country

Seller is to have goods available andpackaged when promised, load collectingvehicle, pre-carriage and export clearance

Buyer must unload delivering vehicle, maincarriage, import clearance and on carriage

Neither party is required to insure

Transport mode: All modes

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Free Alongside Ship (FAS)(named port)

Named port is alongside a vessel at port onthe sellers side

Seller is to deliver goods, export packed

alongside the buyer-designated vessel atthe port on the sellers side along withexport clearance

Buyer loads vessel, arranges main carriage,

import clearance and on carriage

Neither party is required to insure

Transport Mode: Vessel Only

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Free on Board (FOB)(named port)

Named port is loaded on a vessel at a porton the sellers side

Seller delivers the goods on board the

buyer-designated vessel at the port on thesellers side along with export clearance

Buyer arranges main carriage, importclearance and on carriage

Neither party is required to insure

Transport mode: Vessel Only

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Cost & Freight (CFR)(named port)

Named port is on the buyers side

Seller delivers goods export packed onboard the sellers designated vessel at the

port on the sellers side, paystransportation costs to the agreed port onbuyers side, and arranges export clearance

Buyer arranges vessel unloading, import

clearance and on carriage

Neither party is required to insure

Transport Mode: Vessel Only

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Carriage Paid To (CPT)(named place)

Named place on buyers side

Seller delivers goods export packed to thecarrier for transportation to the named

place of destination and will pay alltransportation costs thereto along witharranging export clearance

Buyer arranges import clearance and oncarriage

Neither party is required to insure

Transport mode: All modes

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Cost, Insurance and Freight (CIF)(named port)

Named port is on buyers side

Seller delivers goods export packed onboard the sellers-designated vessel at port

on sellers side, pays all transportationcosts to agreed port on the buyers sideand arranges export clearance

Buyer arranges import clearance and oncarriage

Seller must provide at least minimumcoverage

Transport Mode: Vessel Only

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Cost, Insurance Paid (CIP)(named place)

Named place on buyers side

Seller delivers goods export packed to thecarrier for transportation to the named place of

destination and pays all transport costs theretoalong with arranging export clearance

Buyer arranges import clearance and oncarriage

Seller must provide at least minimuminsurance coverage

Transport Mode: All Modes

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Delivered at Terminal (DAT)(named place)

Named place at terminal on buyers side (aterminal at the destination port or aterminal not far beyond the destination portwhere its yet to be cleared by Customs)

Seller arranges export clearance anddelivers goods export packed to the nameddestination terminal, pays all transportcosts thereto and unloads

Buyer arranges import clearance and oncarriage

Neither party is required to insure Transport Mode: All Modes

Delivered at Place (DAP)

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Delivered at Place (DAP)(named place)

Named place on buyers side

Seller arranges export clearance, deliversexport packed goods to the named place of

destination and pays all transportationcosts thereto

Buyer arranges import clearance and oncarriage

Neither party is required to insure

Transport mode: All Modes

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For more information contact:

Mary Jo Muoio

Senior Vice President, Trade Services

mjmuoio@ohl.com

973 402 8300

Diane Raffle

Drawback and Export Compliance Manager

draffle@ohl.com

267 570 2850

mailto:mjmuoio@ohl.commailto:draffle@ohl.commailto:draffle@ohl.commailto:mjmuoio@ohl.com