Incoterms 2020 — A Practical Guide
What are Incoterms?
Incoterms (International Commercial Terms) are a set of standardised trade rules published by the International Chamber of Commerce (ICC). They define the responsibilities of buyers and sellers in international transactions — who arranges and pays for transport, insurance and customs formalities, and exactly where risk passes from seller to buyer. Using the correct Incoterm on your invoice and contract avoids costly misunderstandings and delays at the Port of Koper and beyond.
Why Incoterms matter for your shipments
Every Incoterm answers three key questions: Who pays for the main carriage? Who is responsible for export and import customs clearance? At which point does the risk of loss or damage transfer? Choosing the right term protects your margins and clarifies liability. Our forwarding and customs teams help you select the term that best fits your cargo, route and risk appetite.
The 11 Incoterms 2020 rules
Rules for any mode of transport
EXW — Ex Works: the seller makes the goods available at their premises; the buyer bears almost all cost and risk. FCA — Free Carrier: the seller delivers, cleared for export, to a carrier named by the buyer. CPT — Carriage Paid To: the seller pays carriage to the named destination; risk passes at handover to the first carrier. CIP — Carriage and Insurance Paid To: as CPT, but the seller also provides insurance. DAP — Delivered at Place: the seller delivers when the goods are ready for unloading at the destination. DPU — Delivered at Place Unloaded: the seller delivers and unloads at the destination. DDP — Delivered Duty Paid: the seller bears all costs and risks, including import duties and clearance.
Rules for sea and inland waterway transport
FAS — Free Alongside Ship: the seller delivers alongside the vessel at the named port. FOB — Free On Board: the seller delivers on board the vessel; risk passes once goods are loaded. CFR — Cost and Freight: the seller pays cost and freight to the destination port. CIF — Cost, Insurance and Freight: as CFR, but the seller also arranges marine insurance.
How Europacific helps
As a freight forwarder and customs broker at the Port of Koper, Europacific arranges sea, road, rail and air transport, handles export and import customs clearance, and can advise on the Incoterm that keeps your supply chain simple and compliant. Contact our team for guidance on your next shipment.
Disclaimer
This page is a general informational summary of Incoterms 2020 and does not constitute legal advice. Incoterms® is a trademark of the International Chamber of Commerce. For the full official rules, refer to ICC publications.