The importance of Incoterms

In the world of international logistics, Incoterms - short for International Commercial Terms - are the foundation on which global trade rests. These rules, laid down by the International Chamber of Commerce, define the responsibilities of buyers and sellers for the delivery of goods under sales contracts. They are crucial for freight forwarders, importers and exporters worldwide, as they create clarity and security in international trade relations.

What are Incoterms?

Incoterms are standardized commercial clauses that are used in contracts to define the terms of delivery. They regulate the distribution of costs and risks between the contracting parties. Since their introduction in 1936, Incoterms have been regularly updated to keep pace with changing practices in global trade. The latest update, Incoterms 2020, came into force on January 1, 2020.

CSI Incoterms
CSI Incoterms

The role of Incoterms in air freight logistics

Incoterms are particularly important in the field of air freight logistics. They influence decisions on bills of lading, insurance policies and customs clearance processes. For example, the term "CPT" (Carriage Paid To) specifies that the seller bears the cost of transporting the goods to the destination, while the risk of loss or damage to the goods, as well as additional costs, is transferred to the buyer after the goods have been handed over to the carrier.

Choosing the right Incoterms

Choosing the right Incoterms is crucial for minimizing risks and costs. For example, choosing "DAP" (Delivered at Place) can mean more risk for the seller, as he is responsible for delivering the goods to the named place at the buyer's premises. On the other hand, "EXW" (Ex Works) can be riskier for the buyer as he bears all costs and risks from the moment the goods are made available at the seller's location.

Conclusion

Incoterms are an indispensable tool for all players in international trade. They provide a language that is understood by all parties and set clear guidelines that help prevent misunderstandings and legal disputes. For companies involved in air freight logistics, a deep understanding of Incoterms is not only an advantage, but a necessity to be successful in the global market.

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