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Incoterms 2
 

Incoterms 2

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INTERNATIONAL COMMERCIAL TERMS

INTERNATIONAL COMMERCIAL TERMS

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    Incoterms 2 Incoterms 2 Presentation Transcript

    • Rohit Pareek (31) Prashna Bhattarai (32)
    • Introduction Universally recognised set of definitions of international trade terms Recognised by courts and other authorities Define the trade contract responsibilities and liabilities between buyer and seller Updated regularly to keep pace with changes and developments in international trade
    • Introduction Devised an published by the ICC WBO ICC introduced Incoterms in 1936 Incoterms 2012 EXW- Ex Works FCA- Free Carrier FAS- Free Alongside Ship FOB- Free On Board CFR- Cost and Freight CIF- Cost, Insurance and Freight CPT- Carriage Paid To CIP- Carriage and Insurance Paid To DDP- Delivered Duty Paid DAP: Delivery At Place
    • Introduction Purpose of Incoterms Designed for Parties to a Contract Provides a set of international rules for foreign trade Reduces uncertainties Avoids different interpretations in different countries Additional costs and time can be avoided
    • Introduction Limitation • To rights and obligations of the parties to contract of sale with respect to the delivery of the goods sold. • Do not deal with the consequences of breach of contract • Primarily intended for use where goods are sold for delivery across national boundaries, hence international commercial terms. • Can be used in contracts for sale of goods directly.
    • Types of Incoterms: 1) Ex-works: Goods available only at seller’s premises. Buyer: loads the goods on truck or container at the seller’s premises, and takes into account the subsequent costs and risks. 2) Free Carrier (FCA): Buyer: main carriage/freight, cargo insurance and other costs and risks.
    • Types of Incoterms: 3)Free Alongside Ship (FAS): Seller: places the goods alongside the ship at the named port, loaded at his expense. Buyer: pays loading fee, main carriage/freight, cargo insurance and other costs risks. 4) Free on Board (FOB): Delivery of goods on board the vessel at the port of origin is at the seller’s expense. Buyer is responsible for loading fee, main carriage/ freight, cargo insurance and other costs risks.
    • Types of Incoterms: 5) Cost and Freight (CFR): Seller: pays the costs and freight to bring the goods to the port of destination. Risk transferred once the goods have crossed the ship’s rail. 6) Cost Insurance and Freight (CIF): Used exactly the same way as CFR except that Seller: must in addition procure and pay for insurance for the cargo insurance and delivery of goods to the port of destination Buyer: responsible for the import customs clearance & other costs and risks
    • Types of Incoterms: 7) Carriage Paid To (CPT): Seller delivers the goods at the named place of destination at his expense. Buyer assumes the cargo insurance, import customs clearance, payment of customs duties and taxes, and other costs and risks. 8) Carriage and Insurance Paid To (CIP): Seller delivers the goods on the ship. On board, the risk is transferred to the buyer. Buyer is accountable for the import customs clearance, payment of customs duties and taxes, and other costs and risks until goods reach their final destination.
    • Types of Incoterms: 9) Delivery Duty Paid (DDP): Seller is responsible for most of the expenses and it is a “door to door” delivery. Risk is transferred when the goods are delivered. 10) Delivery at Place (DAP): Seller pays for carriage to the named place, except for costs related to import clearance.