Who pays for what — and where risk transfers — in international trade
What do Incoterms® cover?
Incoterms® clarify who handles transport stages, export/import formalities, insurance (where specified), and the point where risk transfers from seller to buyer. Always name the place — e.g., DAP Manchester, UK.
Quick Reference (selected terms)
| Term | Export formalities | Main carriage | Insurance | Import formalities | Risk transfers |
|---|---|---|---|---|---|
| EXW | Buyer | Buyer | Buyer | Buyer | At seller’s premises |
| FOB | Seller | Buyer | Buyer | Buyer | On board vessel at load port |
| CIF | Seller | Seller | Seller (minimum cover) | Buyer | On board vessel at load port |
| DAP | Seller | Seller | Not specified | Buyer | At named place before import |
| DDP | Seller | Seller | Not specified | Seller | At buyer’s named place (after import) |
When to Use Which Term
- FOB/CIF: Traditional sea terms for bulk or non-containerised cargo (use FCA/CIP for containerised where appropriate).
- DAP: Buyer pays import duties/taxes but gets delivery to site.
- DDP: Seller handles duties/taxes and delivers to buyer’s site — popular for e-commerce flows.
How Clintopia Helps
We help you choose the right term and execute the plan via Freight Forwarding, Sea Freight, Air Freight, Customs Clearance, and Distribution. Seller-fulfilled? See E-commerce Fulfilment.
Related terms
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