GLOSSARY
Incoterms
Standardized three-letter trade terms from the International Chamber of Commerce (ICC) that assign costs, risks, and obligations between buyer and seller.
Incoterms are three-letter trade terms published by the International Chamber of Commerce (ICC), currently in the Incoterms 2020 edition. They assign specific cost, risk, and obligation responsibilities between buyer and seller in a cross-border sale.
There are 11 Incoterms in the 2020 edition: EXW, FCA, FAS, FOB, CFR, CIF, CPT, CIP, DAP, DPU, DDP. Each sets where risk transfers, who pays freight, who takes out insurance, and who clears customs on export and import.
Related terms
- FOB, CIF, DDP, EXW
- Risk transfer
- Named place of delivery