Yes for some bulk sea trades — confirm with ops.

Is this a substitute for legal or customs advice on Incoterms Glossary?

No — practical guidance only; consult professionals for specific cases.

Which Trade31 tools should I use with this topic?

Cross-check with related calculators, templates, and linked knowledge articles.

How often should we refresh internal SOPs?

Update when rules, FX, or buyer requirements change — review at least quarterly.

Incoterms Glossary

Glossary of Incoterms® 2020 rules and related trade terms — EXW to DDP, risk, freight, and insurance.

Incoterms · Reading time: 5 min read

Quick answer

• The Incoterms glossary defines each ICC rule — EXW, FCA, FOB, CFR, CIF, DAP, DDP, and others — by delivery point, risk shift, and cost split. • Use it to translate contract shorthand into operational tasks: who books…

Table of ContentsOptional

One-Minute Answer
Decision path
Introduction
Why It Matters
Use Cases
Core Rules
Supporting Terms
References

Essentials

Quick answer, takeaways, and checklist — core value in 1–2 minutes.

One-Minute Answer

The Incoterms glossary defines each ICC rule — EXW, FCA, FOB, CFR, CIF, DAP, DDP, and others — by delivery point, risk shift, and cost split.
Use it to translate contract shorthand into operational tasks: who books carriage, who clears export or import, who insures.
Memorizing definitions without naming place/port leads to contracts that neither logistics nor finance can execute.
Look up your quoted term, write the named location, then map tasks to your PI and forwarder instructions.

Introduction

Incoterms Glossary is a core topic in international trade practice. Quick definitions for the 11 rules and supporting vocabulary used in contracts and emails.

Core Rules

EXW — Ex Works
FCA — Free Carrier
FOB — Free On Board
CFR/CIF — Cost and Freight / Cost, Insurance and Freight
CPT/CIP — Carriage Paid To / Carriage and Insurance Paid To
DAP/DPU/DDP — Delivered At Place / Unloaded / Duty Paid

What should I do next?

Practical detail

Process, risks, examples, and mistakes — expand when you need them.

Expand

Decision pathExpand

Each Incoterm rule names who pays freight, insurance, and export/import formalities at defined points. Which term are you validating?

Sea/inland waterway terms (FOB, CFR, CIF) → require a named port; risk moves at ship's rail or on board per rule edition agreed.
Any mode terms (EXW, FCA, DAP, DDP) → require a named place; check whether import clearance sits with seller only under DDP.
Commonly confused pairs → FOB vs FCA (port vs place); CIF vs CIP (marine vs all modes insurance baseline differs).
Verify before use → confirm Incoterms 2020 (or agreed edition) reference in contract and match glossary task list to your deal.

Use CasesExpand

Apply this guide to Incoterms Glossary in these situations:

Ocean or inland waterway FCL/LCL exports
Letter-of-credit shipments
FOB/CIF quotes with buyer-nominated carriers
Incoterm selection before comparing EXW/FCA/DDP

Supporting TermsExpand

Named place — precise delivery point
Risk transfer — when loss risk passes
Main carriage — international transport leg

Common MistakesExpand

Knowing the term but omitting it from contracts — state "Incoterms Glossary" with place and Incoterms version
Document fields not matching quotes or physical cargo
Ignoring country- or bank-specific field rules
No email trail when terms change
Treating the topic as a substitute for quality or payment clauses

What you should do nextExpand

Pick the glossary entry for your quoted term and list the five tasks: carriage, insurance, export clearance, import clearance, delivery.
Highlight any task your team cannot perform (e.g., import clearance under DDP) before accepting buyer terms.
Insert the glossary task list as an annex note on the PI for operations and finance alignment.
Browse the Incoterms glossary on Trade31 when countering buyer-requested term changes.

Why It MattersOptional

Incoterms Glossary affects quote accuracy, document compliance, clearance speed, and payment security. Build these dimensions into your SOP.

Area	Effect	Recommended action
Compliance	Wrong fields or terms trigger holds, amendments, or penalties	Pre-shipment review against latest rules and bank/buyer requirements
Cost	Hidden charges or unclear responsibility erodes margin	Model full cost with calculators before confirming quotes
Lead time	Inconsistent documents delay clearance and release	Cross-check invoice–PL–B/L with a checklist
Risk	Disputes over transfer points drive claims	Contract the place, Incoterms version, and evidence rules

Deep reference

Long explanations, FAQ, and supporting material — collapsed by default.

Expand

ReferencesReference

ICC Incoterms® 2020

Official ReferencesReference

ExamplesReference

Usage

In email: "Under FOB, risk transfers on board at the port of shipment."

Example — Incoterms Glossary with tool cross-check

After stating terms and fields on the PI, the team runs Trade31 calculators and templates pre-shipment to avoid L/C discrepancies and customs holds.

Lesson: Archive review outputs in the order file.

Example — Incoterms Glossary with tool cross-check

After stating terms and fields on the PI, the team runs Trade31 calculators and templates pre-shipment to avoid L/C discrepancies and customs holds.

Lesson: Archive review outputs in the order file.

FAQReference

Is FAS still used?: Yes for some bulk sea trades — confirm with ops.
DAT?: Replaced by DPU in 2020.
Is this a substitute for legal or customs advice on Incoterms Glossary?: No — practical guidance only; consult professionals for specific cases.
Which Trade31 tools should I use with this topic?: Cross-check with related calculators, templates, and linked knowledge articles.
How often should we refresh internal SOPs?: Update when rules, FX, or buyer requirements change — review at least quarterly.

ConclusionReference

Complete the first action in the One-Minute Answer, then follow “What you should do next.”

Browse all knowledge →

One-Minute Answer

The Incoterms glossary defines each ICC rule — EXW, FCA, FOB, CFR, CIF, DAP, DDP, and others — by delivery point, risk shift, and cost split.
Use it to translate contract shorthand into operational tasks: who books carriage, who clears export or import, who insures.
Memorizing definitions without naming place/port leads to contracts that neither logistics nor finance can execute.
Look up your quoted term, write the named location, then map tasks to your PI and forwarder instructions.

Area

Effect

Recommended action

Compliance

Wrong fields or terms trigger holds, amendments, or penalties

Pre-shipment review against latest rules and bank/buyer requirements

Cost

Hidden charges or unclear responsibility erodes margin

Model full cost with calculators before confirming quotes

Lead time

Inconsistent documents delay clearance and release

Cross-check invoice–PL–B/L with a checklist

Risk

Disputes over transfer points drive claims

Contract the place, Incoterms version, and evidence rules

Incoterms Glossary

Quick answer

One-Minute Answer

Introduction

Core Rules

What should I do next?

From reading to doing

Incoterms Glossary

Quick answer

One-Minute Answer

Introduction

Core Rules

What should I do next?

From reading to doing

Quick answer

One-Minute Answer

Introduction

Core Rules

What should I do next?

Related Tools

Related Knowledge

Related Countries

Related Industries

Related Resources

From reading to doing

Quick answer

One-Minute Answer

Introduction

Core Rules

What should I do next?

Related Tools

Related Knowledge

Related Countries

Related Industries

Related Resources

From reading to doing