13 Types of Trade Methods in International Trade

1. EXW – EX Works (… named place)

The seller delivers the ready‑made goods at their premises such as factory or warehouse. Normally the seller is not responsible for loading goods onto the buyer’s vehicle or export customs clearance.

2. FCA – Free Carrier (… named place)

The seller completes export customs clearance and hands over goods to the carrier appointed by the buyer at the designated place. At the buyer’s request, the seller may assist to sign transport contracts. All risks and costs shall be borne by the buyer.

3. FAS – Free Alongside Ship (… named port of shipment)

The seller places goods alongside the vessel at the named port of shipment. All risks of loss or damage and all relevant costs pass to the buyer from that moment. The buyer is responsible for export customs formalities.

4. FOB – Free on Board (… named port of shipment)

The seller loads goods onto the vessel at the named port of shipment. Risks of loss, damage and relevant costs transfer to the buyer once goods are on board. The seller shall complete export customs clearance.

5. CFR – Cost and Freight (… named port of destination)

The seller pays ocean freight to the named port of destination. After goods are loaded on board, risks of loss, damage and extra charges pass over to the buyer. Export customs clearance is undertaken by the seller.

6. CIF – Cost, Insurance and Freight (… named port of destination)

The seller has the same obligations under CFR. Additionally, the seller arranges marine cargo insurance and pays insurance premium to cover risks of loss or damage during transportation. The seller handles export customs clearance.

7. CPT – Carriage Paid To (… named place of destination)

The seller pays carriage for goods to the named place of destination. After goods are handed over to the carrier, risks of loss or damage and any additional expenses pass to the buyer. The seller shall finish export customs clearance. This term applies to all modes of transport including multimodal transport.

8. CIP – Carriage and Insurance Paid to (… named place of destination)

The seller assumes the same obligations as CPT. Besides, the seller arranges cargo insurance and pays the insurance premium. All risks and additional costs shall be borne by the buyer after delivery of goods.

Note: DAF, DES, DEQ and DDU are obsolete under current Incoterms®2020, for historical reference only

9. DAF – Delivered at Frontier (… named place)

The seller transports goods to the designated place at the frontier, and makes goods available to the buyer on‑board the arriving means of transport without unloading. The seller completes export customs clearance, but not import clearance.

10. DES – Delivered Ex Ship (… named port of destination)

The seller delivers goods to the buyer on‑board the vessel at the named port of destination without import customs clearance. The seller bears all risks and costs to bring goods to the destination port. It applies only to sea or inland waterway transport.

11. DEQ – Delivered Ex Quay (Duty Paid) (… named port of destination)

The seller delivers goods to the buyer on the quay at the named port of destination. The seller bears all risks and costs, including customs duties and other taxes. This term applies to sea and inland waterway transport.

12. DDU – Delivered Duty Unpaid (… named place of destination)

The seller delivers goods at the named place in the importing country. The seller bears all costs and risks up to this point, excluding import duties and official charges. Import customs clearance is the buyer’s responsibility.

13. DDP – Delivered Duty Paid (… named place of destination)

The seller delivers goods at the named place within the importing country. The seller bears all risks and full costs throughout transportation, and completes import customs clearance including payment of import duties and taxes.