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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
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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
973 402 8300
Diane Raffle
Drawback and Export Compliance Manager
267 570 2850
mailto:[email protected]:[email protected]:[email protected]:[email protected]