Incoterms 2020
According to ICC, Incoterms® 2020 / Incoterms 2020 contains the ICC rules for use of the 11 Incoterms® trade terms. It updates rules to reflect current commercial practices, making them more accessible and user-friendly.
The new rules will enter into action on 1 January 2020. As of this date, all sales contracts should refer to the Incoterms® 2020 rules as the latest version of the Incoterms rules.
Since 1936, ICC has issued and updated Incoterms rules to reflect trade developments. The Incoterms 2020 edition will be available in 27 languages.
And as per ICC: “This newest edition of the Incoterms® rules will help prepare the business for the next century of global trade”.
What is the meaning of Incoterms?
Incoterms, or International Commercial Terms, reduce confusion between buyers and sellers, facilitating clear communication in global trade.
What is new in Incoterms 2020?
As per the ICC website, below are the major updates in Incoterms 2020
- Incoterms® 2020 provides for demonstrated market need about 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.
Deepen your knowledge and read about The Difference Between DAP and DDU
The main responsibilities/obligations to be resolved through incoterms
- Point of delivery/destination: here, the incoterms define where to deliver between a buyer and a seller.
- Transportation costs: Which party pays for transportation?
- Export and import formalities: Who is responsible for export and importer arrangements?
- Insurance cost: Incoterms to define who to be in charge of the insurance cost.
Who publishes Incoterms?
Founded in 1919, the International Chamber of Commerce (ICC) has facilitated global trade by establishing standard rules. The ICC introduced the first Incoterms in 1936 to address varying practices in international trade. Since then, Incoterms have evolved through versions in 1953, 1967, 1976, 1980, 1990, 2000, 2010, and the 2020 edition, marking the ICC’s centenary.
You can order your Incoterms 2020 edition from ICC.
Explore further by checking out these related articles:
Recent Comments