Some of the Most Important Terms of International Shipping

Last updated 11 July 2020
Some of the Most Important Terms of International Shipping

EXW (Ex Works)

This term puts the biggest obligation on the buyer while only a small obligation on the seller. The seller delivers the product to a specific location, and the buyer bears the transportation costs. The seller only has to deliver the product properly and to the agreed location. The seller must help the buyer to obtain the necessary documents in order to bring the product, and it is the seller who bears the costs of these documents.

Also read: Information About the Bill of Lading

FOB (Free on Board)

The seller bears all costs and risks until the goods are properly loaded on board. Then responsibility is transferred to the buyer. The seller’s responsibility ends when the goods are loaded on the ship.

  Types of Shipping Terms

CFR / CNF (Cost & Freight)

The seller has a bigger responsibility, as he is responsible for arranging the shipping process as well as paying the transportation costs. The seller must provide the buyer with the necessary documents to obtain the goods. Responsibility is transferred to the buyer until the ship reaches the specified port. The buyer is responsible for any other transportation costs until goods reach the final destination.

Also read: Information About Shipping Terms

DAP (Delivered at Place)

The seller is responsible for transporting the goods to a specific location. He bears all risks and costs until the goods are delivered to the agreed place, and he is responsible for completing the procedures necessary to move the goods to that place. The seller, not the buyer, bears all the costs of unloading the goods in that place. This term applies to all ways of transport, not only marine transport.

  Payment Methods in International Trade

CPT (Carriage Paid to)

The seller is responsible for arranging the shipping process to the specified location, and of course, this will be included in the sale price, but he does not have to secure the goods to that place. Responsibility for risks, such as damage to the goods, is moved from the seller to the buyer upon receipt of the carrier.

Also read: Why Are Shipping Terms Important to the Trader

اقراء المقالة باللغة اخرى : العربية

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