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<p><br></p><p>INCOTERMS, short for International Commercial Terms, are a set of rules established by the International Chamber of Commerce (ICC) that define the responsibilities of buyers and sellers in international trade transactions. These terms clarify who is responsible for various aspects of the shipping process, including:</p><p>Delivery: Specifies when and where the risk of loss or damage to the goods shifts from the seller to the buyer.</p><p>Transportation Costs: Indicates who is responsible for paying for transportation, insurance, and freight costs.</p><p>Customs Duties and Taxes: Clarifies which party is responsible for customs clearance and payment of duties and taxes.</p><p>Insurance: Determines if and how the goods will be insured during transport.</p><p>There are currently 11 INCOTERMS, divided into two groups based on the mode of transport:</p><h3>Group 1: Applicable to Any Mode of Transport</h3><p>EXW (Ex Works): The seller makes the goods available at their premises, and the buyer assumes all risks and costs from that point.FCA (Free Carrier): The seller hands over the goods, cleared for export, to a carrier specified by the buyer.CPT (Carriage Paid To): The seller pays for transportation to a specified destination but risk transfers to the buyer once the goods are handed to the carrier.CIP (Carriage and Insurance Paid To): Similar to CPT, but the seller also provides insurance for the goods during transit.DAP (Delivered at Place): The seller bears all costs and risks until the goods are delivered to a specified location.DPU (Delivered at Place Unloaded): The seller delivers goods unloaded at a specified location, assuming all risks and costs.DDP (Delivered Duty Paid): The seller is responsible for delivering the goods to the buyer's location, including all duties and taxes.</p><h3>Group 2: Applicable to Sea and Inland Waterway Transport</h3><p>FAS (Free Alongside Ship): The seller delivers goods alongside a vessel at a port; the buyer is responsible for loading.FOB (Free on Board): The seller delivers goods on board a vessel; risk transfers to the buyer once on board.CFR (Cost and Freight): The seller pays for transportation to a specified port, but risk transfers to the buyer once the goods are on board.CIF (Cost, Insurance, and Freight): Similar to CFR, but the seller also provides insurance for the goods during transit.</p><p>These terms help facilitate international trade by providing clarity and reducing disputes between parties involved in transactions.</p>