Incoterms® 2020 ready – The International Chamber of Commerce of Paris has approved the text
The new Incoterms ® 2020, which will come into force from 1 January 2020, will define the international sales conditions relating to the methods of fulfilling the obligation to deliver the goods.
What are Incoterms®: International Commercial Terms
In addition to facilitating commercial exchanges, Incoterms clearly establish the respective duties and responsibilities, costs and risks connected between the parties to a sales contract (which is the transport contract), increasing the uniformity of treatment between different countries. and between contractors operating in different contexts, thus reducing the risk of legal complications.
Fedespedi has worked with determination for a profound revision of the EXW clause, in consideration of the considerable problems arising from its use and which have increased the number of its detractors, who would like its elimination.
Customer comes always first for Sogedim: here is a guide for the correct application of the clauses based on the type of transport considered.
Incoterms 2020® – what are the expected changes for 2020?
Compared to the last edition, the terms are unchanged in the number – 11 – and in the denomination, with the sole exception of the DAT, now renamed DPU = Delivered at Place Unloaded.
There remains a clear division between terms to be used for maritime transport and in inland waterways and terms that can be used in the presence of any mode of transport (maritime terms: FAS, FOB, CFR, CIF; terms for any mode: EXW, FCA, CPT, CIP, DAP, DPU, DDP).
For over 90 years, Incoterms have supported international trade in goods by assisting importers and exporters from all over the world to organize transport in a transparent and clear manner within the scope of the obligations and costs relating to it.
Basically, the sections of the introductory text have been rewritten in more common language, rather than legal jargon. This is to make explanations easier and more business-friendly. Incoterms have also been reorganized, with greater emphasis on the delivery phases and the associated risk.
Here are the main changes in Incoterms 2020:
The presentation and design have been revised to be more intuitive, the language in the text and in the notes has been simplified and clarified;
DAT Incoterm has been changed to DPU;
The insurance points are clarified in terms of CIF and CIP;
Costs and cost structures are now clearly detailed;
Transportation security is now clearly detailed;
Provisions have been added to allow for private transport.
Some of these changes, as small and delicate as they may seem, can actually make a big difference within global trade.
Finally, we remind you that the official text of the rules is in English and that it is possible to purchase the bilingual edition (Italian-English) directly from the Fedespedi Secretariat.
Sogedim provides an Incoterms table in pdf format, updated to 2020.
You can download it so that you no longer have doubts about the costs and risks between seller and buyer.