Incoterms®

Incoterms® are iCC trade rules that allocate specified delivery obligations, costs and risk between seller and buyer when incorporated into the sales contract.

Published by AllwayforwardUpdated 18 Oct 2026

Understand it in practice

A visual breakdown of Incoterms®: Delivery + risk, Transport costs and Customs responsibilities. The illustration simplifies the concept; the definition and applicable terms determine the details.

Where it fits in the journey

Highlighted stages are commonly relevant

01Agree — commonly relevant
02Prepare
03Transport
04Clear
05Deliver

THE PICTURE, IN WORDS

Incoterms® at a glance

Delivery + risk
Transport costs
Customs responsibilities

THE DETAIL THAT MATTERS

Do Incoterms determine ownership or payment terms?

Write the rule, exact named place or port and edition. Incoterms do not by themselves determine ownership transfer or payment terms.

ILLUSTRATIVE EXAMPLE

Use a complete instruction

“FCA [exact factory address], Incoterms® 2020” identifies a rule, handover place and edition. “Shipping included” leaves much more unresolved. Keep payment, ownership and any assembly services explicit elsewhere in the contract.

Costs and risk are different questions

Rule	Usual risk handover	Import clearance
EXW	Goods available at named origin place	Buyer
FCA	Delivery to nominated carrier at agreed point	Buyer
FOB / CIF	On board at origin port	Buyer
DAP	At named destination, ready for unloading	Buyer
DDP	At named destination, ready for unloading	Seller

Hand-drawn freight notebook connecting goods, documents and transport. — Trade terms in context · original educational illustration, not a photograph of a shipment.

Simplified comparison of ordinary delivery obligations. Named places, agreed variations and exceptional circumstances matter. Incoterms® is a registered trademark of the International Chamber of Commerce.

Before you book

For trade terms, have these details ready:

Exact named delivery place or port
Incoterms® edition in the sales contract
Who handles customs, duties and unloading

Explore trade terms support

Sources & further reading

Plain-language educational guidance. The applicable contract, carrier tariff, official rules or insurance policy takes precedence. Illustrations show concepts, not a specific shipment or facility.

Published by Allwayforward as a plain-language freight reference. Examples are illustrative, not customer case studies. For a correction, send the term and supporting source.