11 Trade Terms, How Many Trade Terms Are There?

The 11 terms in the International Terminology of the Incoterms 2010 are as follows:

Group I: Seven terms that apply to any mode of transport: EXW, FCA, CPT, CIP, DAT, DAP, DDP.

EXW(EX Works) Ex Works.

FCA (Free Carrier) is a free carrier.

CPT (carriage paid to) is paid to the destination.

CIP (carriage and insurance paid to) The insurance premium is paid to the destination.

DAT (Delivered at Terminal) is delivered at a terminal at the destination or destination port.

DAP(Delivered at Place).

DDP (Delivered Duty Paid)

Group 2: Four terms applicable to water modes of transport: FAS, FOB, CFR, CIF.

FAS (Free Alongside Ship) is delivered alongside ship at the port of shipment.

FOB (Free On Board) is delivered free on board at the port of shipment.

CFR (Cost and Freight).

CIF(Cost Insurance and Freight) Cost, insurance and freight.

Extended information: Trade terms, also known as price terms, are special terms that have been produced in long-term international practice to indicate the composition and delivery conditions of a transaction, and to determine the risks, responsibilities, and cost division between buyers and sellers.

Main effects:1It is beneficial for buyers and sellers to negotiate transactions and conclude contracts. Since each of the first terms has a unified interpretation of the obligations of the buyer and the seller, it is conducive to the buyer and the seller to clarify their respective rights and obligations and close the transaction as soon as possible.

2.Beneficial for both buyers and sellers to calculate** and costs. Various terms have a clear definition of who bears the costs, freight and insurance premiums, and it is easier for buyers and sellers to calculate the costs and costs.

3.It is conducive to resolving disputes in the performance of the contract. Since the terms are interpreted by the relevant international practices, the disputes between the buyer and the seller in the transaction can be interpreted by the international practices.

**The terms are:

1. FOB: is the English abbreviation of Free On Board or Freight On Board, and its Chinese meaning is "Free on Board at the Port of Shipment (Designated Port of Shipment)".

Using this term, the seller shall be responsible for the export customs clearance, delivery of the goods to the ship assigned by the buyer within the port of shipment and within the specified time limit specified in the contract, bear all risks before the goods cross the ship's side at the port of shipment, and notify the buyer in a timely manner.

The risk transfer rules in this article have been amended in the 2010 General Principles of International Terminology Interpretation, and the risk is transferred to the buyer after the goods are loaded on board the ship at the port of shipment. (Since the 2000 General Principles of Interpretation stipulate that the risk of crossing the side of the ship is transferred, it is not convenient to prove whether the side of the ship is crossed, so it is amended.) ）

2. C&F: That is, "cost and freight.""The English abbreviation of the company, which means "cost plus freight" in Chinese Using the term, the seller is responsible for chartering the vessel and booking the vessel according to the usual conditions and paying the freight to the port of destination, loading the goods on board the ship according to the port of shipment and the shipping period specified in the contract and notifying the buyer in a timely manner.

3. CIF: i.e. "Cost Insurance and Freight.""The English abbreviation of , which means "cost plus insurance, freight" in Chinese. In this term, the seller is responsible for chartering and booking the vessel under the usual conditions and paying the freight to the port of destination, loading the goods on board the ship within the port of shipment and the shipping period specified in the contract, and is responsible for the insurance of the cargo transportation and the payment of the insurance premium.

4. FCA: that is, "Free Carrier.""The English abbreviation of , whose Chinese meaning is "free carrier". Using this term, the seller is responsible for handling the customs clearance of the goods for export, handing over the goods to the carrier designated by the buyer at the time and place agreed in the contract, and notifying the buyer in a timely manner.

5. CPT: The English abbreviation of "carriage paid to", its Chinese meaning is "freight paid to the specified destination", using this term, the seller shall enter into a contract of carriage at its own expense and pay the freight to transport the goods to the destination. After going through the customs clearance procedures for the export of the goods, the goods shall be handed over to the carrier at the agreed time and the designated place of shipment, and the buyer shall be notified in time.

The 11 terms are summarized as follows:

There are seven terms that apply to any mode of transport: EXW, FCA, CPT, CIP, DAT, DAP, DDP.

1. EXW (EXWORKS) factory delivery.

2. FCA (Freecarrier) delivery to carrier.

3. CPT (carriagepaidto) freight is paid to the destination.

4. CIP (carriageandinsurancepaidto) freight insurance premium is paid to the destination.

5. DAT (DeliveredATTERMINAL) delivery at the terminal of the destination or destination port.

6. DAP (DeliveredATPLACE) destination delivery.

7. DDP (DeliveredDutyPaid) is delivered after duty.

There are four terms that apply to the mode of water transportation: FAS, FOB, CFR, CIF.

1. FAS (FreeAlongsideship) shipping port side delivery.

2. FOB (Freeonboard) shipping port for delivery.

3. CFR (Costandfreight) cost and freight.

4. CIF (CostInsuranceAndFreight) cost, insurance premium and freight.

Introduction to International Terminology:

International terminology is the various ways in which obligations and risks are divided between buyers and sellers, from the International Chamber of Commerce (International Terminology 2020). Among them, how to divide what to do in the transaction (i.e., obligations), and who is responsible for mistakes in the work (i.e., risks). At present, (General Principles 2020) a total of 11 divisions are provided before.

The three most commonly used terms are FOB, CFR, and CIF.

1、fob（freeonboard）。

Free on board (......Designated port of shipment)" The buyer is responsible for chartering and booking and bearing the freight, and the buyer is responsible for applying for the insurance and bearing the insurance premium. The buyer bears all costs and risks of loss or damage to the goods after they have crossed the ship's side at the port of shipment.

2、cfr（cost&freight）。

Cost & Freight (......Designated port of destination)" The seller is responsible for chartering and booking and bearing the freight, and the buyer is responsible for handling the insurance and bearing the insurance premium. The buyer assumes all risk of loss of or damage to the goods after they have crossed the ship's side at the port of shipment.

Cost plus insurance, freight (......Designated port of destination)" The seller is responsible for chartering and booking the vessel and bears the freight, and the seller is responsible for handling the insurance and bearing the insurance premium. The buyer assumes all risk of loss of or damage to the goods after they have crossed the ship's side at the port of shipment.

**Explanation of terms and nouns:

The term refers to the long-term practice of international **, which is an important part of the import and export commodities**, and is a special term used to describe the place of delivery, the ** of the commodity and the division of risks, responsibilities and expenses between the buyer and the seller.

Function: 1. It is conducive to the negotiation of transactions and the conclusion of contracts between buyers and sellers.

2. It is conducive to the calculation of the first and the best costs for both buyers and sellers.

3. It is conducive to the buyer and the seller to resolve disputes in the performance of the contract.

International practice regarding ** terminology:

There are three main types of international practice regarding terminology:

1. The Warsaw-Oxford Rules, 1932

2. The 1941 Revised Definition of the United States as a Foreign Language

The following six are explained in the revised version:

1) EX (Origin Digging).

2) FOB (delivery on a means of transport).

3) FAS (delivery next to the means of transport).

4) C&F (Cost & Freight).

5) CIF (cost plus insurance, freight).

6) Exdock (Free Terminal at the Port of Destination).