Choosing an Incoterm for your transport mode
Incoterms 2020 are eleven standard trade terms that define who pays for carriage, who bears the risk of loss, and who clears the goods through customs. A key practical rule is that some apply to any mode of transport while four are reserved for sea and inland-waterway shipments. This reference lets you filter the eleven rules by mode and read what each one means.
How it works
The split is simple once you know it:
Any mode (road, rail, air, sea, multimodal):
EXW FCA CPT CIP DAP DPU DDP
Sea & inland waterway only:
FAS FOB CFR CIF
The four sea-only rules assume the goods are physically handed over at the quay or on board the vessel, which is why they use port-based delivery points. The seven any-mode rules use a named place and a carrier hand-over, so they fit containers, trucks, aircraft, and combined journeys. Each rule also shifts the balance of cost and risk: EXW is minimum seller obligation, DDP is maximum.
Tips and notes
The single most common mistake is using FOB or CIF for containerised cargo. Because a container is given to the carrier at a terminal long before it is loaded onto a ship, FCA, CPT, or CIP describe the real risk transfer far better. Reserve FAS, FOB, CFR, and CIF for bulk and breakbulk cargo that is genuinely delivered alongside or over the rail of a named vessel.