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Incoterms : New Version released  –  Incoterms 2020

Incoterms 2020.PDF

Incoterms is an acronym standing for international commercial terms . “Incoterms” are a series of pre-defined commercial terms published by the International Chamber of Commerce relating to international commercial law. https://iccwbo.org

The Incoterm rules are NOT in themselves  –  and are therefore no substitute for  – a contract of sale. They are devised to reflect trade practice for all goods. They do not deal with the transfer of property/title/ownership of the goods sold. These are matters for which the parties need to make specific provision in their contract of sale. In essence , the Incoterms 2020 rules are not themselves a contract of sale , they only become part of that contract  when they are incorporated into a contract which already exists. Neither do the Incoterm rules provide the law applicable to the contract.

We encourage our clients to visit the ICC website and to utilise the Incoterms 2020 resources published by the International Chamber of Commerce ( ICC).

 

The Main changes

 

The update on the incoterms includes more detailed explanatory notes, so it is even clearer what the responsibilities for the buyer are and what the responsibilities for the seller are for each Incoterm rule, whether you are importing or exporting.

According to the ICC:

  • Incoterms® 2020 provides for demonstrated market need in relation to bills of lading (BL) with an on-board notation and the Free Carrier (FCA) Incoterms® rule.
  • Incoterms® 2020 aligns different levels of insurance coverage in Cost Insurance and Freight (CIF) and Carriage and Insurance Paid To (CIP).
  • Incoterms® 2020 includes arrangements for carriage with own means of transport in FCA, Delivery at Place (DAP), Delivery at Place Unloaded (DPU), and Delivered Duty Paid (DDP).
  • There is a change in the three-letter name for Delivered at Terminal (DAT) to DPU.
  • Incoterms® 2020 includes security-related requirements within carriage obligations and costs.

 

Please note the attached table is based on information gleaned from the ICC website. For detailed explanation reference is made to International Chamber of Commerce (ICC) publication INCOTERMS®  2020. This document is provided to our customers for informational purposes only. Please refer to the official text of the ICC for a full and detailed description of all rights and liabilities arising from the use of the aforementioned Incoterms®  (https://iccwbo.org).

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