http://www.youtube.com/watch?v=X0oO7NTdGZg&feature=player_embedded#at=25
Introduction
On 1 January 2011, the ICC’s Incoterms 2010 came into force. These are the eighth revision of the
Incoterm Rules, with the last revision dating back to 2000. The new Rules have been revised to take
into account developments in international trade over the past ten years as the volume and complexity
of global sales has increased, to address security issues arising in recent times and to provide for the
ongoing changes in electronic communication. The new Rules also recognise the growth of customsfree
areas.
One of the principal concerns with regard to the Incoterms has been that often the wrong term is
selected for use by the parties. The introduction to the new 2010 Rules stresses the need to use the
term appropriate to the goods, to the chosen means of transport and to whether or not the parties
intend to impose additional obligations on the seller or buyer. In addition, there are Guidance Notes
(and a diagram) at the front of each Incoterms Rule containing information to assist in making a choice
on which Rule to use.
Summarised below are the principal changes to the 2000 version.
Reclassification of Rules
The new Rules have been separated into two classes: (i) Rules for use in relation to any mode or modes
of transport, which can be used where there is no maritime transport at all or where maritime transport
is used for only part of the carriage and (ii) Rules for sea and inland waterway transport, where the
point of delivery and the place to which the goods are carried to the buyer are both ports.
FAS, FOB, CFR and CIF belong to the second class of Rules. In respect of FOB, CFR and CIF, reference
to the “ship’s rail” has now been deleted and this has been replaced with the goods being delivered
when they are “on board” the vessel.
Rules apply to domestic as well as international trade
The Incoterms have traditionally been used for international sale contracts even though some trade
blocs, such as the European Union, have minimised the significance of border formalities. The new
Rules now recognise that they can also be used for domestic sale contracts and reference is made in
a number of the Rules that export and import formalities will only need to be complied with where
applicable. It is anticipated that this change may encourage greater use of the Rules in the USA in place
of the former US Uniform Commercial Code.
Two new terms replace four current terms
Incoterms 2000 contained 13 Rules, which have been reduced to 11 terms in Incoterms 2010. This
has been achieved by introducing two new Rules to replace four current Rules. The two new Rules
may be used irrespective of the mode of transport selected and under both new Rules, delivery takes
place at a named destination. In essence, the “D” (Delivered) terms under the 2000 Rules have been
consolidated to reduce the number of terms that were considered to have little real difference between
them.
DAT (Delivered at Terminal) replaces DEQ (Delivered ex Quay). DAT may be used irrespective of the
mode of transport selected and may also be used where more than one mode of transport is employed.
“Delivered at Terminal” means that the seller delivers when the goods, having been unloaded from the
arriving means of transport, are placed at the buyer’s disposal at a named terminal at the named port or
Introduction
On 1 January 2011, the ICC’s Incoterms 2010 came into force. These are the eighth revision of the
Incoterm Rules, with the last revision dating back to 2000. The new Rules have been revised to take
into account developments in international trade over the past ten years as the volume and complexity
of global sales has increased, to address security issues arising in recent times and to provide for the
ongoing changes in electronic communication. The new Rules also recognise the growth of customsfree
areas.
One of the principal concerns with regard to the Incoterms has been that often the wrong term is
selected for use by the parties. The introduction to the new 2010 Rules stresses the need to use the
term appropriate to the goods, to the chosen means of transport and to whether or not the parties
intend to impose additional obligations on the seller or buyer. In addition, there are Guidance Notes
(and a diagram) at the front of each Incoterms Rule containing information to assist in making a choice
on which Rule to use.
Summarised below are the principal changes to the 2000 version.
Reclassification of Rules
The new Rules have been separated into two classes: (i) Rules for use in relation to any mode or modes
of transport, which can be used where there is no maritime transport at all or where maritime transport
is used for only part of the carriage and (ii) Rules for sea and inland waterway transport, where the
point of delivery and the place to which the goods are carried to the buyer are both ports.
FAS, FOB, CFR and CIF belong to the second class of Rules. In respect of FOB, CFR and CIF, reference
to the “ship’s rail” has now been deleted and this has been replaced with the goods being delivered
when they are “on board” the vessel.
Rules apply to domestic as well as international trade
The Incoterms have traditionally been used for international sale contracts even though some trade
blocs, such as the European Union, have minimised the significance of border formalities. The new
Rules now recognise that they can also be used for domestic sale contracts and reference is made in
a number of the Rules that export and import formalities will only need to be complied with where
applicable. It is anticipated that this change may encourage greater use of the Rules in the USA in place
of the former US Uniform Commercial Code.
Two new terms replace four current terms
Incoterms 2000 contained 13 Rules, which have been reduced to 11 terms in Incoterms 2010. This
has been achieved by introducing two new Rules to replace four current Rules. The two new Rules
may be used irrespective of the mode of transport selected and under both new Rules, delivery takes
place at a named destination. In essence, the “D” (Delivered) terms under the 2000 Rules have been
consolidated to reduce the number of terms that were considered to have little real difference between
them.
DAT (Delivered at Terminal) replaces DEQ (Delivered ex Quay). DAT may be used irrespective of the
mode of transport selected and may also be used where more than one mode of transport is employed.
“Delivered at Terminal” means that the seller delivers when the goods, having been unloaded from the
arriving means of transport, are placed at the buyer’s disposal at a named terminal at the named port or
