Trade terms reference
Incoterms 2020: EXW, FCA, FOB, DDP and all 11 rules
Incoterms allocate delivery, risk, carriage, insurance and export or import formalities between seller and buyer. This comparison covers all 11 Incoterms 2020 rules, separates the seven multimodal rules from the four maritime rules, and shows what must still be written into the sales contract.
By Ayhan Karaca, Co-Founder · Updated: September 10, 2026
Seven rules for any mode or combination of modes
The named place matters as much as the three-letter rule. Delivery and risk can transfer before the seller-paid carriage ends, especially under CPT and CIP.
| Rule | Delivery and risk point | Seller's main commitments | Buyer's main commitments |
|---|---|---|---|
| EXW — Ex Works | Goods made available at the named place, not loaded | Make goods available | Load, export/import formalities and all carriage |
| FCA — Free Carrier | Delivered to buyer's carrier at the precise named place | Export clearance and delivery to the nominated carrier | Main carriage, insurance if wanted and import formalities |
| CPT — Carriage Paid To | Risk transfers when goods are handed to the first carrier | Export clearance and carriage to named destination | Risk after first-carrier delivery, insurance if wanted and import formalities |
| CIP — Carriage and Insurance Paid To | Risk transfers when goods are handed to the first carrier | CPT duties plus broad cargo insurance required by the rule | Risk after first-carrier delivery and import formalities |
| DAP — Delivered at Place | At destination, ready for buyer to unload | Carriage and risk to named destination; export clearance | Unloading and import clearance, duty and tax |
| DPU — Delivered at Place Unloaded | At destination after seller unloads | Carriage, risk and unloading at named destination | Import clearance, duty and tax |
| DDP — Delivered Duty Paid | At destination, import-cleared and ready for unloading | Maximum seller obligation: carriage plus export and import formalities, duty and applicable tax | Unloading; assist with information when required |
Four rules only for sea and inland waterway transport
ICC reserves FAS, FOB, CFR and CIF for delivery alongside or on board a vessel at a port. For containerized or multimodal cargo delivered to a terminal before vessel loading, ICC's checklist directs users toward FCA rather than FOB.
| Rule | Delivery and risk point | Who pays main freight | Insurance under the rule |
|---|---|---|---|
| FAS — Free Alongside Ship | Alongside the vessel at named port of shipment | Buyer | No seller obligation |
| FOB — Free On Board | On board the vessel at named port of shipment | Buyer | No seller obligation |
| CFR — Cost and Freight | Risk transfers on board at shipment port | Seller pays to named destination port | No seller obligation |
| CIF — Cost, Insurance and Freight | Risk transfers on board at shipment port | Seller pays to named destination port | Seller obtains the rule's minimum cargo cover |
Selection traps that change cost and control
Choose the rule after mapping the actual pickup, terminal, main carriage, border and destination sequence. A familiar acronym can still be wrong if the named point does not match physical delivery.
- EXW can leave the buyer responsible for export steps it may be unable to perform; ICC describes it as primarily suitable for domestic trade and points exporters toward FCA where appropriate.
- CPT and CIP separate the risk-transfer point from the destination to which the seller pays carriage.
- CIP requires broader seller-arranged insurance than CIF; neither removes the need to check limits, exclusions and insured value.
- DPU is the only rule where the seller must unload at destination.
- DDP gives the seller import-clearance and duty obligations; confirm that the seller can legally complete them in the destination country.
- FCA is usually the better starting point for container cargo handed to a terminal before it is loaded on the vessel.
Write a complete contract line and preserve the evidence
Use the format: selected rule + precise named place or port + Incoterms 2020. Record who books each transport leg, who clears export and import, who buys insurance, where delivery and risk transfer, and which document proves each handoff.
- Incoterms do not set price, payment timing, transfer of title, product specification, force majeure or dispute law.
- Do not write only “FOB” or “DDP”; name the exact terminal, port, warehouse or point.
- Align the purchase order, commercial invoice, freight booking, insurance instruction and landed-cost model to the same agreed term.
- Escalate tax, customs and enforceability questions to qualified professionals in the relevant countries.
Carry the agreed term into the cost evidence.
Connect the named delivery point, responsible party, freight leg, customs step and supporting document to the same shipment record.