New Incoterms May Come With Several Changes
The International Chamber of Commerce is expected to revise its incoterms to “clearly and accurately reflect current trade practices” when it releases its new set of the international commercial terms in September, according to an Aug. 29 post from Export Solutions.
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The ICC may add new Cost and Insurance incoterms, which “allows for ‘risk’ to pass from the seller to the buyer at the port of departure,” and expand the incoterm Free Carrier Alongside, which could become two classifications for land and ocean transports, the post said. The ICC may also revise the incoterm Free on Board and the incoterm Cost, Insurance and Freight for container shipping because the “vast majority” of traders are using the terms incorrectly, the post said.
The ICC is also expected to remove several incoterms, including: Free Alongside Ship, Delivered Duty Paid (see 1908090036) and Ex Works, which is no longer “preferred for international trade,” the post said. The removal of Ex Works could “be quite consequential for many U.S. exporters who have terms with their customers for title transfer at their door,” the post said. The latest revisions to the incoterms are expected to be released in mid-September and will take effect Jan. 1, 2020.