What are Incoterms?

Incoterms are international standard rules that determine "to what extent am I responsible for transportation costs, insurance, and risks, and from where does the buyer take over responsibility?"

These rules were created by the International Chamber of Commerce (ICC), and the current version is Incoterms 2020. (The next revision is expected around 2030)

Why is this important?

- It clarifies who bears the costs (freight, insurance, taxes, etc.)

- It specifies who is responsible in case of damage or loss of goods

- It helps prevent disputes and simplifies contracts

Incoterms 2020 includes 11 terms. The seller's (exporter's) responsibilities increase in the order of E → F → C → D.

Let's take a closer look at the four most commonly used criteria in practice.

The suitable conditions vary depending on the situation.

These are common mistakes made when using Incoterms.

Let's take a look at how the costs vary by conditions when sending 1CBM (100 boxes, 200kg) of cosmetics from Korea to the United States.