Delivery Types
A) EX WORKS (EXW)
"Ex works" means that the seller fulfills his obligation to deliver by keeping the goods ready for the buyer's order in his business (factory, warehouse, etc.). The seller is not responsible for loading the goods into a vehicle provided by the buyer or for passing the goods through export customs unless otherwise agreed. The buyer bears the responsibility of all expenses and risks related to the transportation of the goods from this point to the destination. This term is a form of sale that includes the least obligation for the seller among all sales types. In this form of delivery, only the packaged goods price is included in the sales price specified in the contract. In other words, all kinds of transportation, loading, unloading and insurance costs from the delivery date are paid by the buyer.
B) FREE CARRIER (FCA)
With this term, the seller's obligation to deliver ends with the delivery of the goods to the carrier determined by the buyer, at the specified place or point, after the goods are cleared for export. If a definite place of delivery is not specified by the buyer, the seller may specify a place in the vicinity of the place where the carrier will receive the goods. If commercial practices require the help of the seller in order to conclude a contract with the carrier (for example, in rail and air transport), the seller may act at the buyer's risk and expense.
C) FREE ALONGSIDE SHIP (FAS)
With this term, the seller's obligation to deliver ends when the goods are put on a quay or barge in line with the ship at the designated port. This means that from now on, all costs, risks of loss or damage to the goods are borne by the buyer. Loading, unloading, transportation and insurance costs of the goods are paid by the buyer. In FAS, the sales price specified in the contract includes both the cost of goods and the shipping fee to the quay. This term indicates that the buyer must clear the goods for export. It should not be used if the buyer is not going to fulfill the export transactions directly or indirectly. This term is used only for sea or inland water transport.
D) FREE ON BOARD (FOB)
With this term, the seller's obligation to deliver is fulfilled from the moment the goods open the ship's rail at the designated loading port. All risks of loss or damage to the goods are borne by the buyer from this point forward. If the ship's rail does not mean anything in practice (for example, in DIRT-on/mile-off or container transportation), it would be more appropriate to use the term FCA.
E) COST AND FREIGHT(CFR)
With this term, the seller has to pay all the necessary expenses and freight in order to send the goods to the designated port of destination. However, the risk of loss of damage to the goods and the increase in expenses will be transferred from the seller to the buyer from the moment the goods pass the ship's rail at the loading port. The term CFR indicates that the seller must clear the goods for export.
F) COST, INSURANCE AND FREIGHT (CIF)
With this term, the seller has the same obligations under the CFR. However, in addition, he has to provide marine insurance against the risk of loss or damage during the transportation of the goods. The seller makes the insurance contract and pays the insurance premium. With this term, the buyer should be aware that the seller has only the obligation to provide minimum coverage in the insurance. This term indicates that the seller must clear the goods for export. This term is used only in sea and inland water transport. If the ship's rail does not mean anything in practice, it would be more appropriate to use the term CIP.
G) CARRIAGE PAID TO (CPT)
This term means that the seller pays the necessary freight for the immovable until the agreed place of race of the goods. The risks of loss and damage to the goods, as well as additional costs that may arise from delivery to the carrier, pass from the seller to the buyer as of the delivery of the goods to the custody of the carrier. The carrier is the person who undertakes the transportation process resulting from iron, land, sea, air, inland water transportation or their combination in a carriage contract.
H) CARRIAGE AND INSURANCE PAID TO (CIP)
With this term, the seller has the same obligations as in the CPT. However, in addition, it has to provide cargo insurance against the risk of loss or damage during the transportation of the goods. The seller makes the insurance contract and pays the insurance premium.
I) DELIVERED AT FRONTIER (DAF)
This term means that the seller's obligation to deliver ends when the goods have been cleared for export and made available at the designated place or point at the border but before the customs border of the adjacent country. The term border can be used for any border, including the border of the country of export. It is therefore vital that the boundary in question is always precisely defined by specifying the point or location within the term.
J) DELIVERED EX SHIP (DES)
With this term, the seller's obligation to deliver ends by keeping the goods ready for the buyer's disposal at the named port of destination, on board the ship, without passing through import customs. The seller bears all costs and risks required to bring the goods to the designated port of race. This term can only be used for sea or inland water transport.
K) DELIVERED EX QUAY (DUTY PAID)(DEQ)
Delivery at Dock (Duties Paid) With this term, the seller's obligation to deliver ends by keeping the goods on the quay ready for buyer's order, having passed through import customs at the named port of destination. The seller bears all risks and expenses, including taxes, duties and other charges, related to the transportation of the goods up to that point. This term should not be used if the seller cannot obtain an import license directly or indirectly. If the parties want the goods to be cleared by the buyer and the customs duties to be paid, they should use the term "dirty unpaid" instead of "duty paid". If the parties wish to exclude from the seller's obligations some expenses to be paid for the importation of the goods (such as VAT), they must make this clear by adding words that will create this effect.
L) DELIVERED DUTY UNPAID (DDU)
With this term, the seller's obligation to deliver ends when the goods are made available at the named place in the country of importation. The seller has to bear the risks and expenses related to the transportation of the goods up to that point and the fulfillment of the customs formalities (excluding the taxes and duties to be paid for import). The buyer has to bear the additional costs and risks arising from the fact that the goods are not cleared for importation on time. If the parties want the seller to fulfill the customs formalities and bear the costs and risks that may arise from it, they should make it clear by adding words that will create this effect. This term can be used regardless of the mode of transport.
M) DELIVERED DUTY PAID (DDP)
With this term, the seller's obligation to deliver ends when the goods are made available at the named place in the country of importation. The seller has to bear the risks and expenses, including the taxes, duties and other charges necessary for the transportation of the goods up to that point and for their import customs clearance. The less obligation the term EXW represents for the seller, the more the term DDP means.