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Incoterms 2020 Buyer and Seller Responsibility Reference

Incoterms 2020 define where risk passes from seller to buyer and who pays for carriage, export and import clearance, and insurance. Use this table to check what an Incoterm on a quote or PO really commits you to.

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Rule	Full name	Transport mode	Risk passes to buyer	Export clearance	Main carriage paid by	Import clearance	Insurance obligation	Buyer note
EXW	Ex Works	Any mode	When goods are placed at the buyer's disposal at the seller's premises or named place, not loaded	Buyer	Buyer	Buyer	None	Maximum buyer burden. Buyer loads and clears export, which foreign buyers often cannot do.
FCA	Free Carrier	Any mode	When goods are handed to the buyer's carrier at the named place	Seller	Buyer	Buyer	None	Preferred over EXW for containers and air freight. Named place decides who loads.
CPT	Carriage Paid To	Any mode	When goods are handed to the first carrier, not at destination	Seller	Seller	Buyer	None	Seller pays freight but risk moves early. Arrange your own cargo insurance.
CIP	Carriage and Insurance Paid To	Any mode	When goods are handed to the first carrier	Seller	Seller	Buyer	Seller, Institute Cargo Clauses (A) minimum	Insurance level is highest of the CIF and CIP rules in Incoterms 2020.
DAP	Delivered at Place	Any mode	At the named destination, ready for unloading on the arriving vehicle	Seller	Seller	Buyer	None	Buyer unloads and pays import duty and VAT. Clear the named place on the PO.
DPU	Delivered at Place Unloaded	Any mode	At the named destination after unloading	Seller	Seller	Buyer	None	Only rule where the seller unloads. Replaced DAT from Incoterms 2010.
DDP	Delivered Duty Paid	Any mode	At the named destination, ready for unloading, import cleared	Seller	Seller	Seller	None	Maximum seller burden. Check who is importer of record and who bears import VAT.
FAS	Free Alongside Ship	Sea and inland waterway	When goods are placed alongside the vessel at the named port of shipment	Seller	Buyer	Buyer	None	Suited to bulk and break-bulk cargo, not containers.
FOB	Free On Board	Sea and inland waterway	When goods are on board the vessel at the named port of shipment	Seller	Buyer	Buyer	None	Do not use for containers handed over at a terminal. Use FCA instead.
CFR	Cost and Freight	Sea and inland waterway	When goods are on board the vessel at the port of shipment	Seller	Seller	Buyer	None	Seller pays sea freight but you carry transit risk. Insure the cargo yourself.
CIF	Cost, Insurance and Freight	Sea and inland waterway	When goods are on board the vessel at the port of shipment	Seller	Seller	Buyer	Seller, Institute Cargo Clauses (C) minimum	Minimum cover is limited. Ask for higher cover if the goods are high value.
DAT	Delivered at Terminal (withdrawn)	Any mode	Not applicable, replaced by DPU in Incoterms 2020	Not applicable	Not applicable	Not applicable	Not applicable	Still appears on old POs. Treat as DPU only if both parties agree in writing.
DDU	Delivered Duty Unpaid (withdrawn)	Any mode	Not applicable, removed in Incoterms 2010	Not applicable	Not applicable	Not applicable	Not applicable	Ambiguous term. Replace with DAP on new POs.
DES	Delivered Ex Ship (withdrawn)	Sea	Not applicable, removed in Incoterms 2010	Not applicable	Not applicable	Not applicable	Not applicable	Replace with DAP for sea deliveries.
DEQ	Delivered Ex Quay (withdrawn)	Sea	Not applicable, removed in Incoterms 2010	Not applicable	Not applicable	Not applicable	Not applicable	Replace with DPU or DAP depending on who unloads.
DAF	Delivered at Frontier (withdrawn)	Land	Not applicable, removed in Incoterms 2010	Not applicable	Not applicable	Not applicable	Not applicable	Replace with DAP and name the exact place.

General guidance only. Incoterms govern delivery, risk and costs between buyer and seller, not title transfer, payment terms or governing law. Always name the place or port after the rule, for example FCA Shenzhen Factory Gate, and state the Incoterms version.

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How to use this reference

Type a rule such as FCA or a phrase such as insurance into the search box to filter the table. Compare the risk column first, because that is the point after which loss or damage is your problem even if the seller pays the freight. Then check who clears export and import. Export the filtered view to Excel to attach to a sourcing review or supplier agreement. Always read the rule together with the named place, because the place decides who loads, who unloads and where the handover happens.

Search by rule, mode or responsibility
Read the risk column before the freight column
Check the named place on the PO against the rule
Export the result for the sourcing file

What the eleven rules group into

Incoterms 2020 has seven rules for any mode of transport (EXW, FCA, CPT, CIP, DAP, DPU, DDP) and four for sea and inland waterway only (FAS, FOB, CFR, CIF). They also split into rules where the buyer arranges main carriage (EXW, FCA, FAS, FOB) and rules where the seller does (the rest). Only EXW leaves export clearance to the buyer, and only DDP puts import clearance on the seller. Insurance is mandatory for the seller only under CIF and CIP.

Worked example for a purchasing decision

A buyer in Texas sources castings from a foundry in India. Under FCA Mumbai Port Terminal the foundry clears export and hands over at the terminal, and the buyer books the ocean freight, insures the cargo and clears import. Under DAP Houston the foundry owns the freight and the transit risk until the truck arrives at the buyer's dock, but the buyer still clears import and pays duty. Compare the landed cost and the claim process under each rule, not only the unit price.

Common mistakes

Using FOB for containers, using CIF when you need full insurance cover, leaving off the named place, quoting a rule without the Incoterms version, and assuming DDP removes all import risk when the buyer is still importer of record. Another frequent error is assuming the Incoterm settles who owns the goods or when payment is due. It does not. Those points belong in the contract and payment terms.

FOB and CIF are for non-container sea cargo
Name the place and the Incoterms year
Incoterms do not transfer title
Check importer of record under DDP

Frequently Asked Questions

What is the difference between FCA and FOB?

FOB applies only to sea and inland waterway transport and passes risk once goods are on board the vessel. FCA works for any mode and passes risk when goods are handed to the buyer's carrier at the named place. For containerised cargo handed over at a terminal, FCA is the correct choice.

Which Incoterm is best for a buyer?

There is no single best rule. Buyers who want control of freight and cost often choose FCA, while buyers who want the seller to manage delivery choose DAP. The right choice depends on your freight capability, supplier reliability and who can better manage customs.

Does DDP mean the seller pays all taxes?

DDP puts import clearance, duty and the obligation to deliver cleared goods on the seller. Import VAT treatment varies by country and by who is importer of record. Confirm the arrangement with your customs broker before accepting DDP.

Do I need to state the Incoterms version?

Yes. The parties can choose any edition, and rules such as DAT changed names between editions. Write the rule, the named place and the year, for example FCA Shenzhen Factory Gate Incoterms 2020, on the PO and the supply agreement.

If your ERP stores Incoterms on the PO but nobody checks them against landed cost or freight accruals, we can build a read-only check that flags mismatches from your live purchasing data.

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