The goal of the Incoterms is to alleviate or reduce confusion over interpretations of shipping terms, by outlining exactly who is obligated to take control of and/or insure goods at a particular point in the shipping process. Further, the terms will outline the obligations for the clearance of the goods for export or import, and requirements on the packing of items. The Incoterms are used quite frequently in international contracts, and a specific version of the Incoterms should be referenced in the text of the contract.
Although the Incoterms are widely used, they are not meant for every type of contract. The 13 Incoterms fall into four different groups. Each group's letter makes up the first letter of Incoterm.
Source: US Department of Commerce
Departure (E)
Main Carriage Unpaid (F)
Main Carraige Paid (C)
Arrival (D)
Incoterms is an International Chamber of Commerce (ICC) trademark. The ICC protects both the trademark and copyright. Please refer to www.iccwbo.org/incoterms for accurate trade definitions.
Ex Works: (Abbrev. EXW)
Free Alongside Ship: (Abbrev. FAS)
Free Carrier: (Abbrev. FCA)
Free On Board: (Abbrev. FOB)
Cost, Insurance, and Freight: (Abbrev CIF)
Cost and Freight: (Abbrev CFR)
Carriage and Insurance Paid: (Abbrev CIP)
Carriage Paid To: (Abbrev CPT)
Delivered at Frontier: (Abbrev DAF)
Delivered Ex Ship: (Abbrev DES)
Delivered Ex Quay: (Abbrev DEQ)
Delivered Duty Unpaid: (Abbrev DDU)
Delivered Duty Paid: (Abbrev DDP)