Eleven rules, one question.
Incoterms® 2020 are the eleven three-letter rules published by the ICC that define how delivery, risk and cost are split between seller and buyer. Seven of them (EXW, FCA, CPT, CIP, DAP, DPU, DDP) work for any mode of transport; four (FAS, FOB, CFR, CIF) are for sea and inland waterway transport only. The rules do not say when title to the goods passes.
What an Incoterms rule does, and does not do
An Incoterms® rule answers three questions: where the goods are delivered, where risk changes hands and which cost belongs to whom. Each rule is set out in ten seller obligations, A1–A10, and ten buyer obligations, B1–B10.
The rules are not a contract of sale in themselves; they become part of an existing contract by reference. According to the ICC's own list, the rules do not deal with:
- Whether a contract has been concluded at all
- The specifications of the goods and whether they are defective
- The time, place, method and currency of payment
- The consequences of breach and the remedies available
- When title to the goods passes
- The effect of sanctions, embargoes and customs tariffs
That is why reducing a contract to a single delivery-term line is risky. Retention of title, governing law and dispute resolution must be written separately.
Four groups: E, F, C, D
The eleven rules are grouped under four letters in increasing order of what the seller takes on. Knowing the group logic lets you read a rule roughly right even the first time you see it.
- E — Departure
- The seller makes the goods available at its own premises and leaves them there. One rule: EXW.
- F — Main carriage unpaid
- The seller hands the goods to a carrier nominated by the buyer and clears export; the buyer pays the main freight. FCA, FAS, FOB.
- C — Main carriage paid
- The seller pays the main freight but risk passes early, at departure. That is the group's defining feature and its most misunderstood one. CFR, CIF, CPT, CIP.
- D — Arrival
- The seller brings the goods to the place of destination and carries the risk that far. DAP, DPU, DDP.
Under a C rule, "I pay the freight" and "the risk is mine" are not the same thing. If the vessel sinks on a CFR or CIF shipment, the loss is the buyer's even though the seller paid the freight. The buyer's counterparts are the carrier and the insurer, not the seller. The distance between cost transfer and risk transfer is drawn on the cost allocation page.
The eleven rules one by one
EXW — Ex Works
The seller places the goods at the buyer's disposal at its own premises, not loaded on any vehicle and not cleared for export. All risk and cost pass to the buyer from that point. The ICC notes that the rule is essentially suited to domestic trade and points out the difficulties it creates in international sales.
A Turkey-specific problem: a foreign buyer cannot file an export declaration in Turkey in the capacity of exporter. Even where the contract says EXW, the Turkish exporter in practice has the declaration filed — carrying an obligation, and the customs brokerage cost, that it never took on.
FCA — Free Carrier
The seller delivers the goods to the carrier nominated by the buyer at the named place and completes export clearance. If the named place is the seller's premises, the seller loads the goods onto the buyer's vehicle; if it is anywhere else, the seller delivers on its own vehicle, not unloaded.
In the ICC's decision flowchart this is the F rule to choose when the goods travel in a container or by more than one mode, or when delivery is to an inland or port terminal. Detail: FOB or FCA for containerised cargo.
FAS — Free Alongside Ship
The seller places the goods alongside the vessel at the port of loading, on the quay or a barge, and clears export. Sea and inland waterway only. Used for bulk cargo and for heavy pieces that do not fit into a container.
FOB — Free On Board
The seller loads the goods on board the vessel nominated by the buyer at the port of loading; risk and cost split at exactly that moment. Sea and inland waterway only. The ICC states that FOB suits bulk cargo and conventional general cargo — or cases where the seller itself has the container loaded on board.
CFR — Cost and Freight
The seller pays the freight to the port of destination, but risk passes to the buyer when the goods are loaded on board. There is no insurance obligation. Sea and inland waterway only.
CIF — Cost, Insurance and Freight
In addition to CFR, the seller takes out cargo insurance for the buyer's benefit. Risk still passes at the port of loading. Incoterms® 2020 left the minimum cover for CIF unchanged at Institute Cargo Clauses (C). The parties may agree higher cover in the contract.
CPT — Carriage Paid To
The seller arranges and pays carriage to the named place of destination; risk passes to the buyer when the goods are handed to the first carrier. Any mode. No insurance obligation.
For an exporter selling CPT Hamburg from a factory in Bursa, the first carrier is usually the domestic haulier — so risk passes to the buyer at the factory gate while the seller keeps paying freight all the way to Hamburg.
CIP — Carriage and Insurance Paid To
In addition to CPT, the seller insures the goods; risk again passes on delivery to the first carrier. One of the most important substantive changes in Incoterms® 2020 sits here: the minimum cover the seller must provide under CIP was raised to Institute Cargo Clauses (A) — "all risks".
DAP — Delivered at Place
The seller delivers the goods at the place of destination ready for unloading from the arriving vehicle. Unloading is the buyer's. Import clearance and import duties are the buyer's. Any mode. It is today's equivalent of DDU, which was removed in Incoterms® 2010.
DPU — Delivered at Place Unloaded
The seller delivers the goods at the place of destination unloaded from the arriving vehicle. It is the only one of the eleven rules that puts unloading on the seller. It is the renamed DAT of Incoterms® 2010; the name changed because the place of destination no longer has to be a "terminal".
DDP — Delivered Duty Paid
The rule under which the seller takes on the most: it brings the goods to the place of destination, handles export, transit and all import formalities, and pays import duties. Unloading is the buyer's unless the contract of carriage says otherwise.
Caution: most countries require the person filing an import declaration to be established and registered for tax there. A non-resident seller cannot recover import VAT either.
Which rule for which mode of transport
This distinction is the strictest part of the rules and the one most often broken. Four rules — FAS, FOB, CFR, CIF — are for sea and inland waterway transport only, because all four define the delivery point by reference to a vessel.
| Rule | Group | Sea | Road | Air | Rail | Insurance required |
|---|---|---|---|---|---|---|
| EXW | E | ✓ | ✓ | ✓ | ✓ | No |
| FCA | F | ✓ | ✓ | ✓ | ✓ | No |
| FAS | F | ✓ | ✗ | ✗ | ✗ | No |
| FOB | F | ✓ | ✗ | ✗ | ✗ | No |
| CFR | C | ✓ | ✗ | ✗ | ✗ | No |
| CIF | C | ✓ | ✗ | ✗ | ✗ | Yes — ICC (C) |
| CPT | C | ✓ | ✓ | ✓ | ✓ | No |
| CIP | C | ✓ | ✓ | ✓ | ✓ | Yes — ICC (A) |
| DAP | D | ✓ | ✓ | ✓ | ✓ | No |
| DPU | D | ✓ | ✓ | ✓ | ✓ | No |
| DDP | D | ✓ | ✓ | ✓ | ✓ | No |
The "insurance required" column shows the contractual obligation. Under the rules marked "No", the party carrying the risk should still insure in its own interest.
What changed from Incoterms 2010
- DAT was removed, DPU arrived. Renamed to make clear that the place of destination does not have to be a terminal.
- The minimum insurance level under CIP went up. From ICC (C) to ICC (A). The level under CIF did not change.
- Costs were gathered in one article. In 2010 they sat in A6/B6 with some items scattered elsewhere; in 2020 they are all in A9/B9.
- An on-board bill of lading option opened under FCA. The parties may agree that the carrier issues the seller a transport document with an on-board notation, to meet a documentary credit's "on board" requirement.
- Security-related obligations and costs were set out more visibly.
When it goes wrong
The rule + place + version triple is written incomplete
"FOB İzmir" is not enough. If the version is missing, one party may rely on 2010 and the other on 2020, and disputes appear on points such as DPU/DAT and the CIP insurance level.
The right way: "FCA Ambarlı Port, İstanbul, Incoterms® 2020".
The FCA delivery place is left vague
A wording like "FCA İstanbul" leaves the loading obligation open: at the seller's premises the seller loads, at a terminal the seller does not unload. When the place is not written in full, who hires the forklift, who pays waiting time and who pays the empty container return stay in dispute.
Transit damage under a C rule is pushed back onto the seller
Because the seller paid the carriage, the buyer tries to lay damage suffered in transit on the seller. But risk has long passed; the buyer's counterparts are the carrier and the insurer. One of the most frequent loss items seen in operations.
DAT or DDU still written in 2026
DAT became DPU in Incoterms® 2020. DDU was removed in Incoterms® 2010 and its equivalent is DAP. CNF and C&F were never Incoterms® rules; what is meant is CFR. These terms still appear in contracts and declarations.
Frequently asked
Are Incoterms 2030 coming?
Yes, work has started. In its Global Policy Commissions Workplan 2026, published in January 2026, the ICC announced that it would begin revising the Incoterms® rules and named the target version Incoterms® 2030.
But the ICC has not announced a publication or entry-into-force date. The only version in force today is Incoterms® 2020 — keep writing that one into your contracts.
The ICC's revision history page lists 1923, 1928, 1936, 1953, 1967, 1974, 1980, 1990, 2000, 2010 and 2020. The gap between versions has ranged from 5 to 17 years; there is no commitment to a fixed ten-year cycle.
Which rule is used most?
We cannot answer that with a verified statistic — we found no reliable, citable Turkish data on how often each rule is used. The percentages that circulate in the trade have no source.
The tendency we see in practice: Turkish exporters mostly work with FOB and CIF, importers with EXW and FCA. But the right rule is not the "most used" one; it is the one that fits your shipment.
Does an Incoterms rule bind the carrier?
No. Incoterms® rules govern the sale relationship between seller and buyer; they do not bind the carrier and do not replace the contract of carriage.
The carrier's liability is set by separate regimes (CMR, Hague-Visby, Montreal, COTIF-CIM) and by the terms of the transport document. "I sold DAP, so the carrier should pay for the damage" does not work for that reason.
Sources
- ICC — Incoterms® 2020 official page Entry into force and scope · iccwbo.org · accessed 1 Sep 2026
- ICC — Incoterms® rules revision history List of versions from 1936 to date · iccwbo.org · accessed 1 Sep 2026
- ICC — Incoterms® 2020 Checklist and Flowcharts The ICC's own decision flowchart: FCA for containerised or multimodal transport, FOB for general or bulk cargo loaded on board in the conventional way; "all risks" (LMA/IUA Clauses A) cover under CIP · ICC Publication No. 817E, ISBN 978-92-842-0626-1, © 2022 · library.iccwbo.org (PDF, free) · accessed 1 Sep 2026
- ICC — Incoterms® 2020 Introduction (Publication No. 723E) Scope of the rules and the matters they do not deal with. The introduction is signed by Charles Debattista (ICC Special Adviser, Incoterms® 2020 Drafting Group); by its own note the views are the author's and not part of the rules · icc-switzerland.ch (free from ICC Switzerland) · accessed 1 Sep 2026
- ICC — Incoterms® trademark and copyright policy The explanations on this page are our own words, not quotations from the ICC text · iccwbo.org · accessed 1 Sep 2026
- UTİKAD — Incoterms 2020 circular (13 Jan 2020, No. 2020/009) The DAT→DPU change and the clarification under FCA · utikad.org.tr · accessed 1 Sep 2026
- UNCITRAL — CISG (Contracts for the International Sale of Goods) Passing of title and validity of the contract outside its scope; Turkey a party since 1 Aug 2011 · uncitral.un.org · accessed 1 Sep 2026
This page is for information only and is not legal or customs advice. The binding source of the rule texts is the ICC's own publication; the explanations here are summary and interpretation. Consult your customs broker and legal adviser before taking a binding decision. Incoterms® is a registered trademark of the ICC.
Change log
- Page published as the English counterpart of the Turkish page of 1 Sep 2026. Basis: ICC Incoterms® 2020. Per the ICC's January 2026 Workplan the Incoterms® 2030 revision has begun; no publication date has been announced.