Incoterms 2020, Shipping Import & Export Documentation and Procedures

Petaling Jaya , Malaysia

The Incoterms® 2020 provides comprehensive working knowledge of ICC’s globally recognised commercial trade terms, which offer specific guidance for those participating in the import and export of global trade. The global economy has given business broader access than ever before to markets all over the world. Goods are sold in more countries, in larger quantities, and in greater variety. But as the volume and complexity of global sales increase, so do possibilities for misunderstandings and costly disputes when sale contracts are not adequately drafted. The ICC Incoterms® rules on the use of domestic and international trade terms address this risk by facilitating the conduct of global trade. Reference to an Incoterms® rule in a contract for the sale of goods clearly defines the parties’ respective obligations regarding topics such as risk, cost and arrangement of transport & customs clearance and reduces the risk of legal complications. Since ICC first codified a set of standard trading terms as the Incoterms® rules in 1936, this globally accepted contractual standard has been updated periodically to reflect the evolution of international trade. The Incoterms® 2020 rules take account of the increased attention to security in the movement of goods, the need for flexibility in insurance coverage depending on the nature of goods and transport, and the call by banks for an on-board bill of lading in certain financed sales under FCA rule. Incoterms® 2020 also offers a simpler and clearer presentation of all rules, featuring an expanded introduction and explanatory notes. Incoterms® 2020 is also the first version of ICC’s Incoterms® rules to include a ‘horizontal’ presentation, grouping all like articles together and allowing users to clearly see differences in treatment of particular issues across the 11 Incoterms® rules. Incoterms rules define the responsibilities of buyers and sellers for the delivery of goods under sale contracts. They are the authoritative rules for determining how costs and risks are allocated to the parties. Incoterms rules are regularly incorporated into sale contracts worldwide and have become part of the daily language of trade. Incoterms® 2020 contains use of the 11 Incoterms trading terms. It takes into account the latest developments in commercial practice and updates and consolidates some of the former rules. All sales contracts should make reference to the Incoterms® 2020 rules as the latest version of the Incoterms rules. The new Incoterms® 2020 launched on 10th September 2019 is effective worldwide as of 1st January 2020.