If you are new to shipping terms contracts you may be unaware of the different trading practices in their respective countries. A small misunderstanding with the shipping terms could lead to disputes over who was meant to pay for the overseas freight, insurance or other costs involved in the shipment of goods.
The shipping trade rules or International Commercial Terms ( Inco terms) are a series of defined commercial terms published by the International Chamber of Commerce(ICC).
They are widely used in the International trade processes.They are series of three-letter trade terms related to the common contractual sales practices. The Incoterms rules are intended primarily to clearly communicate the tasks, costs, and risks associated with the transportation and delivery of goods.
The rules are accepted by governments, legal authorities, and practitioners worldwide for the interpretation of most commonly used terms in international trade.They are intended to reduce or remove altogether uncertainties arising from different interpretation of the rules in different countries. As such they are regularly incorporated into sales contracts worldwide.
First published in 1936, the Incoterms rules have been periodically updated, with the eighth version "Incoterms 2010" having been published on January 1, 2011.
These terms are used to help eliminate the uncertainties in the different interpretations of such trade terms in language and different countries.To avoid confusion the International Chamber of Commerce published (1936) a set of international rules for standard trade terms known as Incoterms. Since 1936 regular amendments and updates (1953, 1967, 1976, 1980, 1990, 2000 and 2010) have been made to keep all practices and terms current.
