Chapter22
ABRIEFINTRODUCTION
TO
INCOTERMS
ContentsHowIncotermsareusedThePublisherTheHistoryIncoterms2010RulesforanymodeoftransportRulesforseaandinlandwaterwaytransport
Asacorporatesecretary,onemayhavemanyopportunitiestogetinvolvedinmakingcontractsforinternationaltrade.ItisthereforenecessarytohavesomeknowledgeaboutIncoterms.
Incotermsisaregistered?trademark?ofthe?InternationalChamberofCommerce?(ICC).ThewordIncotermsstandsforInternationalCommercialTerms,which?areaseriesofpre-definedcommercialtermspublishedbytheICCrelatingto?internationalcommerciallaw.Theyarewidelyusedininternational?commercialtransactions?astheiruseininternationalsalesisencouragedbytradecouncils,courtsandinternationallawyers.
HowIncotermsareusedIncotermsareaseriesofthree-lettertradeterms.Theyareactuallyrulesorstipulationswhichareintendedprimarilytoclearlycommunicatethetasks,costs,andrisksassociatedwiththetransportationanddeliveryofgoods.EachIncotermisconsideredaruleorastipulation.Theyarebasicallyusedintwoways.OnewayistoincludeinabusinesscontractoneclausecalledTradeTerms,whereoneoftheIncotermscanbewrittenasanevidenceofmutualagreementbetweenthesellerandthebuyer.AnotherwayisjusttoaddanIncotermafterthepriceofthecontract,forexample,US$250,000CIPShanghai.
OnethingtonoteregardingtheuseofIncotermsisthatanyoneofthemmustbefollowedbythenameofadesignatedplaceorport.Forexample,FCABeijing,orFASHuangpuHarbor.Incotermswhicharenotfollowedbythenameofaplaceorportareactuallymeaninglessbecausetheydonotspecifytheexactplacewhereresponsibilities,risksorgoodsaretransferredfromonepartytoanother.
ThePublisherTheIncotermsarepublishedbythe?InternationalChamberofCommerce?(ICC),whichisthelargest,mostrepresentativebusinessorganizationinthe