Incoterms 2010: Basics

Incoterms are primarily a set of rules of interpretation of trade terms, which parties to the transaction can apply with mutual agreement. The terms are therefore not mandatory, and apply only if both trading partners agree to them. While not obligatory, both parties typically use these terms to assign the responsibilities for carriage, customs clearances, and insurance in a transaction. Here we discuss the seven rules that relate to any mode of transport - sea, road, air, or rail (or a combination). We then take a look at the principal changes from Incoterms 2000.