{"id":20227,"date":"2024-12-03T13:31:59","date_gmt":"2024-12-03T11:31:59","guid":{"rendered":"https:\/\/marinair.gr\/?p=20227"},"modified":"2025-07-23T13:43:56","modified_gmt":"2025-07-23T10:43:56","slug":"a-simple-guide-to-incoterms-2020","status":"publish","type":"post","link":"https:\/\/marinair.gr\/el\/articles\/a-simple-guide-to-incoterms-2020\/","title":{"rendered":"A Simple Guide to Incoterms 2020"},"content":{"rendered":"\t\t<div data-elementor-type=\"wp-post\" data-elementor-id=\"20227\" class=\"elementor elementor-20227\" data-elementor-post-type=\"post\">\n\t\t\t\t<div class=\"elementor-element elementor-element-612e50e9 e-flex e-con-boxed e-con e-parent\" data-id=\"612e50e9\" data-element_type=\"container\" data-e-type=\"container\">\n\t\t\t\t\t<div class=\"e-con-inner\">\n\t\t\t\t<div class=\"elementor-element elementor-element-574a76f9 elementor-widget elementor-widget-text-editor\" data-id=\"574a76f9\" data-element_type=\"widget\" data-e-type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t\t\t\n<p class=\"has-medium-font-size\"><strong>Understand the Language of Global Trade \u2013 And Ship Smarter<\/strong><\/p>\n\n<p>In international freight forwarding, clarity matters. Misunderstandings in shipping responsibilities, risks, or costs can lead to delays, disputes, or unexpected charges. That\u2019s where\u00a0<strong>Incoterms\u00ae<\/strong>\u00a0come in \u2013 a set of standardized trade terms that remove ambiguity and ensure buyers and sellers are on the same page.<\/p>\n\n<p>Whether you\u2019re new to international logistics or want a refresher on Incoterms 2020, this guide will help you confidently interpret, choose, and apply them in real-world shipping scenarios.<\/p>\n\n<h2 class=\"wp-block-heading\">What Are Incoterms?<\/h2>\n\n<p><strong>Incoterms<\/strong>, short for\u00a0<em>International Commercial Terms<\/em>, are a set of 11 globally recognized rules published by the International Chamber of Commerce (ICC). They define\u00a0<strong>who is responsible<\/strong>\u00a0for:<\/p>\n\n<ul class=\"wp-block-list\">\n<li>The\u00a0<strong>costs<\/strong>\u00a0involved in transporting goods<\/li>\n\n<li>The\u00a0<strong>risk<\/strong>\u00a0of loss or damage during transport<\/li>\n\n<li>The\u00a0<strong>customs duties and paperwork<\/strong>\u00a0required for exports and imports<\/li>\n<\/ul>\n\n<p>Incoterms are typically written as three-letter acronyms (like\u00a0<strong>FOB<\/strong>,\u00a0<strong>CIF<\/strong>, or\u00a0<strong>DAP<\/strong>) and are used in contracts for the sale of goods across borders. They apply to\u00a0<em>physical goods<\/em>\u00a0in transit, not services or intangible products.<\/p>\n\n<h2 class=\"wp-block-heading\">Why Incoterms Matter in Freight Forwarding<\/h2>\n\n<p>Imagine shipping 5 containers of electronics from Greece to the United States. Who pays the ocean freight? Who handles customs at destination? What if the goods are damaged in transit?<\/p>\n\n<p>Without Incoterms, you&#8217;d need to spell all that out manually. With Incoterms, you can just agree on a term \u2013 say,\u00a0<strong>CFR (Cost and Freight)<\/strong>\u00a0\u2013 and instantly define these roles.<\/p>\n\n<p>For freight forwarders like Marinair Cargo Services, using Incoterms reduces miscommunication, manages liability, and ensures smooth collaboration between shippers, consignees, and agents. They also help in:<\/p>\n\n<ul class=\"wp-block-list\">\n<li>Avoiding shipment delays<\/li>\n\n<li>Preventing invoice disputes<\/li>\n\n<li>Streamlining insurance decisions<\/li>\n<\/ul>\n\n<h2 class=\"wp-block-heading\">What Changed in Incoterms\u00ae 2020?<\/h2>\n\n<p>The\u00a0<strong>2020 revision<\/strong>\u00a0of Incoterms brought several updates aimed at better reflecting modern trade practices:<\/p>\n\n<ol class=\"wp-block-list\" start=\"1\">\n<li><strong>DAT renamed to DPU<\/strong>:<br \/><em>Delivered at Terminal (DAT)<\/em>\u00a0was renamed to\u00a0<em>Delivered at Place Unloaded (DPU)<\/em>\u00a0to clarify that goods can be delivered to any place \u2013 not just a terminal \u2013 as long as they\u2019re unloaded.<\/li>\n\n<li><strong>FCA now allows on-board BL notation<\/strong>:<br \/>Under\u00a0<strong>FCA (Free Carrier)<\/strong>, the buyer and seller can agree to issue a Bill of Lading with an \u201con board\u201d notation, which is often needed for bank payments under Letters of Credit.<\/li>\n\n<li><strong>Security obligations highlighted<\/strong>:<br \/>Security-related requirements (e.g. inspections, documentation) are now more clearly assigned under each term.<\/li>\n\n<li><strong>Increased insurance transparency for CIP and CIF<\/strong>:\n<ul class=\"wp-block-list\">\n<li>Under\u00a0<strong>CIP (Carriage and Insurance Paid To)<\/strong>, the seller must provide\u00a0<strong>higher-level (Clause A)<\/strong>\u00a0insurance.<\/li>\n\n<li>Under\u00a0<strong>CIF (Cost, Insurance and Freight)<\/strong>, the lower\u00a0<strong>Clause C<\/strong>\u00a0level remains unless otherwise agreed.<\/li>\n<\/ul>\n<\/li>\n<\/ol>\n\n<h2 class=\"wp-block-heading\">The 11 Incoterms of 2020, Explained Simply<\/h2>\n\n<p>Incoterms are split into\u00a0<strong>two main groups<\/strong>\u00a0based on the mode of transport:<\/p>\n\n<h3 class=\"wp-block-heading\">A. For All Modes of Transport<\/h3>\n\n<figure class=\"wp-block-table\">\n<table class=\"has-fixed-layout\">\n<tbody>\n<tr>\n<th>Incoterm<\/th>\n<th>Responsibility Summary<\/th>\n<\/tr>\n<tr>\n<td><strong>EXW (Ex Works)<\/strong><\/td>\n<td>Buyer takes everything from the seller\u2019s premises \u2013 transport, risk, costs.<\/td>\n<\/tr>\n<tr>\n<td><strong>FCA (Free Carrier)<\/strong><\/td>\n<td>Seller delivers goods to a carrier nominated by the buyer.<\/td>\n<\/tr>\n<tr>\n<td><strong>CPT (Carriage Paid To)<\/strong><\/td>\n<td>Seller pays for carriage but risk transfers when goods are handed to carrier.<\/td>\n<\/tr>\n<tr>\n<td><strong>CIP (Carriage &amp; Insurance Paid To)<\/strong><\/td>\n<td>Same as CPT, but seller also provides insurance.<\/td>\n<\/tr>\n<tr>\n<td><strong>DAP (Delivered at Place)<\/strong><\/td>\n<td>Seller delivers to buyer\u2019s location \u2013 buyer handles import clearance.<\/td>\n<\/tr>\n<tr>\n<td><strong>DPU (Delivered at Place Unloaded)<\/strong><\/td>\n<td>Seller delivers and unloads goods at destination.<\/td>\n<\/tr>\n<tr>\n<td><strong>DDP (Delivered Duty Paid)<\/strong><\/td>\n<td>Seller handles everything \u2013 including import clearance and duties.<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/figure>\n\n<h3 class=\"wp-block-heading\">B. For Sea and Inland Waterway Transport Only<\/h3>\n\n<figure class=\"wp-block-table\">\n<table class=\"has-fixed-layout\">\n<tbody>\n<tr>\n<td><strong>Incoterm<\/strong><\/td>\n<td><strong>Responsibility Summary<\/strong><\/td>\n<\/tr>\n<tr>\n<td><strong>FAS (Free Alongside Ship)<\/strong><\/td>\n<td>Seller delivers goods alongside the ship at port.<\/td>\n<\/tr>\n<tr>\n<td><strong>FOB (Free On Board)<\/strong><\/td>\n<td>Seller loads goods onto ship \u2013 risk transfers at that point.<\/td>\n<\/tr>\n<tr>\n<td><strong>CFR (Cost and Freight)<\/strong><\/td>\n<td>Seller pays freight but risk passes when goods are onboard.<\/td>\n<\/tr>\n<tr>\n<td><strong>CIF (Cost, Insurance &amp; Freight)<\/strong><\/td>\n<td>Same as CFR, but seller provides insurance.<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/figure>\n\n<h2 class=\"wp-block-heading\">How to Choose the Right Incoterm<\/h2>\n\n<p>When selecting an Incoterm, consider the following:<\/p>\n\n<ul class=\"wp-block-list\">\n<li><strong>Control<\/strong>: Do you want to control the freight provider and costs (use buyer-favored terms like EXW or FCA), or offer full service (use DDP or CIF)?<\/li>\n\n<li><strong>Customs Capabilities<\/strong>: Are you or your partners comfortable handling export\/import clearance?<\/li>\n\n<li><strong>Cargo Type<\/strong>: Is the cargo fragile, valuable, or perishable? Terms with insurance coverage (CIF, CIP) might be preferable.<\/li>\n\n<li><strong>Transport Mode<\/strong>: Some Incoterms only apply to ocean freight (e.g., FOB, CIF). Others are for any mode (e.g., DAP, CIP).<\/li>\n<\/ul>\n\n<p>Choosing the right term requires alignment between the exporter and importer \u2013 and understanding each other\u2019s logistics capabilities and preferences.<\/p>\n\n<h2 class=\"wp-block-heading\">Real-World Examples<\/h2>\n\n<h3 class=\"wp-block-heading\">EXW (Ex Works) Example<\/h3>\n\n<p><em>An electronics importer in Germany buys from a factory in Shenzhen under EXW.<\/em><br \/>The buyer arranges pickup from the factory, inland transport to the port, export customs, ocean freight, and import clearance. All risks transfer at the factory gate.<\/p>\n\n<h3 class=\"wp-block-heading\">DDP (Delivered Duty Paid) Example<\/h3>\n\n<p><em>A textile seller in Italy ships to a boutique in New York using DDP.<\/em><br \/>The seller arranges everything from transport, export clearance, import duties, and final delivery. The buyer receives goods at their store without lifting a finger.<\/p>\n\n<h3 class=\"wp-block-heading\">FCA (Free Carrier) with Letter of Credit<\/h3>\n\n<p><em>A Greek machinery exporter uses FCA to ship to Dubai.<\/em><br \/>To satisfy the buyer\u2019s bank, the exporter gets a Bill of Lading marked \u201con board\u201d even though responsibility transferred earlier. This is now explicitly allowed under FCA in Incoterms 2020.<\/p>\n\n<h2 class=\"wp-block-heading\">Mistakes to Avoid with Incoterms<\/h2>\n\n<ol class=\"wp-block-list\" start=\"1\">\n<li><strong>Using sea-only terms for air freight<\/strong>: Don&#8217;t use\u00a0<strong>FOB<\/strong>,\u00a0<strong>CFR<\/strong>, or\u00a0<strong>CIF<\/strong>\u00a0for air shipments \u2013 choose\u00a0<strong>FCA<\/strong>,\u00a0<strong>CPT<\/strong>, or\u00a0<strong>CIP<\/strong>instead.<\/li>\n\n<li><strong>Misunderstanding risk transfer<\/strong>: Just because the seller pays for freight doesn\u2019t mean they bear the risk (e.g., under CPT, risk passes early).<\/li>\n\n<li><strong>Forgetting about insurance<\/strong>: Some terms don\u2019t require the seller to insure the goods \u2013 always clarify who arranges insurance.<\/li>\n\n<li><strong>Ignoring customs obligations<\/strong>: If using DDP, ensure the seller is able to clear customs in the buyer\u2019s country \u2013 it\u2019s not always practical.<\/li>\n\n<li><strong>Overlooking delivery locations<\/strong>: For DPU, the place\u00a0<em>must<\/em>\u00a0be capable of unloading \u2013 which isn\u2019t the case for all destinations.<\/li>\n<\/ol>\n\n<h2 class=\"wp-block-heading\">Incoterms and Marinair Cargo Services<\/h2>\n\n<p>At Marinair, we help clients choose the right Incoterms for their shipments \u2013 whether they\u2019re new exporters or experienced traders. Our team offers:<\/p>\n\n<ul class=\"wp-block-list\">\n<li>Consulting on Incoterm selection for specific trade lanes<\/li>\n\n<li>Support with export and import documentation<\/li>\n\n<li>Insurance options and risk management<\/li>\n\n<li>Flexible handling across FCA, CPT, DAP, DPU, and other terms<\/li>\n<\/ul>\n\n<p>By understanding and applying Incoterms correctly, our clients avoid costly mistakes, ensure smoother shipping, and build more trust with their partners.<\/p>\n\n<h2 class=\"wp-block-heading\">Master the Language of Logistics<\/h2>\n\n<p>Incoterms 2020 are more than legal jargon \u2013 they are essential tools for\u00a0<strong>clear communication and smart shipping<\/strong>. Whether you&#8217;re sending a single pallet or coordinating global supply chains, understanding these rules helps protect your business, control costs, and streamline your logistics.<\/p>\n\n<p>Want help choosing the best Incoterm for your next shipment?<br \/><a href=\"Mailto:info@marinair.gr\"><strong>Contact Marinair Cargo Services<\/strong><\/a>\u00a0\u2013 your partner in intelligent international freight.<\/p>\n\n<p>\u00a0<\/p>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t","protected":false},"excerpt":{"rendered":"<p>Understand the Language of Global Trade \u2013 And Ship Smarter In international freight forwarding, clarity matters. Misunderstandings in shipping responsibilities, risks, or costs can lead to delays, disputes, or unexpected charges. That\u2019s where\u00a0Incoterms\u00ae\u00a0come in \u2013 a set of standardized trade terms that remove ambiguity and ensure buyers and sellers are on the same page. Whether [&hellip;]<\/p>\n","protected":false},"author":6,"featured_media":20553,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"set","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"var(--ast-global-color-4)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"footnotes":""},"categories":[80],"tags":[81],"class_list":["post-20227","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-knowledge-hub","tag-knowledge-hub"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.4 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>A Simple Guide to Incoterms 2020 - Marinair Cargo Services<\/title>\n<meta name=\"description\" content=\"Incoterms 2020 explained: Learn how international shipping responsibilities are defined using CPT, DDP, FCA, and more. 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