1 Questions
Incoterms in context of supply contracts
refer to a set of international rules for the interpretation of the most commonly used trade terms in foreign trade
Study Notes
Incoterms in Supply Contracts
- Incoterms are a set of three-letter trade terms published by the International Chamber of Commerce (ICC) to clarify the tasks, costs, and risks involved in the transportation and delivery of goods.
- There are 11 Incoterms in use, each defining the obligations of buyers and sellers in international trade, such as who pays for transportation, insurance, and taxes.
- Incoterms typically specify the following:
- The point of delivery
- The point of transfer of risk
- The allocation of costs and responsibilities between buyer and seller
- Incoterms are commonly used in international sales contracts to avoid misunderstandings and disputes between buyers and sellers, especially in cross-border transactions.
- Examples of Incoterms include EXW (Ex Works), FCA (Free Carrier), CPT (Carriage Paid To), CIP (Carriage and Insurance Paid To), DAT (Delivered at Terminal), DAP (Delivered at Place), and DDP (Delivered Duty Paid).
Test your knowledge of Incoterms in the context of supply contracts with this quiz. Explore terms like FOB, CIF, EXW, and more, and see how well you understand the responsibilities and obligations of buyers and sellers in international trade.
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