0:00Incoterms are standard rules published by the International Chamber of Commerce.
0:05They define exactly where cost and risk pass from seller to buyer.
0:11Ex Works, or EXW:
0:14the buyer takes on almost everything from the seller's factory door onward.
0:19Free Carrier, or FCA:
0:21the seller delivers to a named carrier or place, and risk passes there.
0:26Free On Board, or FOB:
0:29the seller loads the goods onto the vessel at the port of origin.
0:33After that, risk and the remaining costs are the buyer's.
0:37FOB is meant for sea freight only.
0:41Cost and Freight, or CFR,
0:44is like FOB, but the seller also pays freight to the destination port.
0:49Risk still passes at loading.
0:51Cost, Insurance and Freight, or CIF,
0:55is CFR plus minimum insurance arranged by the seller.
1:00Carriage and Insurance Paid To, or CIP,
1:03is the multimodal equivalent of CIF, usable for any transport mode.
1:10Delivered At Place, or DAP:
1:13the seller delivers to a named destination and risk passes there,
1:17but you still handle import clearance and duty.
1:21Delivered Duty Paid, or DDP, is the most seller-heavy term.
1:26The seller delivers,
1:27clears customs and pays duty in your country,
1:30leaving you with almost nothing to arrange.
1:34Know exactly where the risk passes before you sign.