AGOA - Introductory guide to Incoterms
This guide provides an overview of the International Commercial Terms, commonly known as ‘Incoterms’, which are terms used in international trade transactions involving the movement of goods, and which provide a common understanding of the parties’ responsibilities and obligations, and when risk passes from the seller to the buyer.
Incoterms significantly simplify international contracting between sellers and buyers and provide clarity and certainty on various critical aspects underlying the sale and transportation of goods as these move from the seller’s premises to the buyer. Each incoterm represents a different standard, with specific obligations, and involves different points of the journey where risk passes from the seller to the buyer. Traders may rely on the underlying criteria of each respective Incoterm when choosing a specific Incoterm, making it easier to conclude a business transaction, manage the logistics process, and to resolve disputes between the parties should they arise.