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Incoterms
Incoterms – Concept
EXW
Ex Works
FOB
Free On Board
CFR
Cost & Freight
Exporter
Importer
Cargo Insurance
DDP
Delivered Duty Paid
Title to Cargo & Responsibility for freight cost and/or insurance
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Incoterms are used in international trade with all payment methods, to include Documentary and Standby Letters of Credit, Trade Credits, International and Direct Collections, and Open Account transactions.
Their purpose is to specify to all the parties involved in the transaction whether the importer or exporter is responsible for paying for the cost of freight, cargo insurance and customs fees.
Incoterms also denote where during the movement of cargo title passes from the importer to the exporter.