The INCOTERMS rules are developed by the International Chamber of Commerce and are applied in international commerce. They are used for international trade deals and are also followed by the freight transport association when forwarding of goods is provided. The INCOTERMS rules clearly define the tasks, costs and risks involved in transporting and delivering goods, as well as the obligations and risks associated with them.
The INCOTERMS rules – facilitating international commerce
The INCOTERMS rules are applied by the governments, the legal authorities as well as by the freight forwarders from all countries, including the European ones where the trade and transport of goods is especially intensive. Not only the leading countries in the production of goods such as Germany France and Italy follow these rules, but a number of the other countries involved in the import and export of goods in Europe, the Middle East and a number of countries in Asia.
The logistics for the import and export of goods relies on the combined services provided by the
freight forwarders Europe. By complying with these rules, all possible problems with controversial and unclear situations which could occur due to discrepancies in the individual rules of the different countries involved in the commercial deal can be avoided. This is why they are an integral part of the commercial contracts throughout Europe. These contracts include the rules for the forwarding, the transport as well as the unloading of the goods provided by the forwarders throughout Europe.
When forming the insurance of the goods as well as the passing through customs, special documents are required and the INCOTERMS rules are used for preparing them to.
The INCOTERMS rules through the years
The first document preceding the Rules was published by the International Chamber of Commerce in 1923. The first edition of the Rules was published in 1936. Further edits of the document were then published in 1953, 1967, 1976, 1980, 1990 and 2000. By 2010, the rules are 13, of which 6 relate to ocean freight and the other 7 are related to all freight forwarding situations and circumstances.
The latest, eighth version is from 2010 and published on January 1, 2011. The new version of the Rules is expected to be published in 2020.
The difference between the revision of the Rules from the years 2000 and 2010
In the most recent revision of the Rules from 2010, the total number of rules included in it has been reduced from 13 to 11. Four of the old rules have been replaced by two new ones as these four rules are not commonly used in day-to-day trading and logistics. The new two rules are DAT and DAP.
The DAT rule
DAT is the abbreviation for the expression “delivered at terminal” – delivered to the terminal. According to this rule, the seller pays for the transport of the goods to the terminal. This rule does not apply to costs related to the customs release of imported goods. The seller carried all risks until the goods are unloaded at the terminal where they are taken over by international freight services.
The DAP rule
DAP is an abbreviation for the term „delivered at place” – delivered to a specific place. According to this rule, the seller pays for the forwarding of the goods to the specific destination, excluding any fees associated with customs and taxes paid for imported goods. The seller carries all risks until the goods are ready for unloading by the buyer.