The INCOTERMS or International Commercial Terms were created by the ICC in 1923 and first published in 1936. The Incoterms rules were amended in 1953, 1967, 1976, 1980, 1990, 2000, 2010 and in September 2019 with the Incoterms 2020.
They are utilised around the globe in international commercial transactions or procurement processes and are recommended as a standard by trade councils, courts and international trades law firms.
The Incoterms intend to set commercial rules and to avoid any uncertainties arising from the differing interpretations of the rules in different countries and they should be integrated into sales contracts worldwide.
The Incoterms 2020 is the ninth version of international contract terms published by the ICC, now includes the “Delivered at Place Unloaded” (DPU) and excludes “Delivered at Terminal” (DAT) terms.
The insurance to be provided under terms CIF and CIP has also changed, increasing from Institute Cargo Clauses to Institute Cargo Clauses. Under the CIF Incoterms rule, which is reserved in maritime trade and often used in commodity trading.
The Institute Cargo Clauses remains the default level of coverage, giving parties the option to agree to a higher level of insurance cover.
In some jurisdictions, the duty costs of the goods may be calculated against a specific Incoterms