Incoterms 2010

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Incoterms 2010
Roland Satchell VP CDCS

Strictly Private and Confidential

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Meet the presenters:
 Charnell Williams, North America Import Product Manager  Charnell is a Director in Citi‘s Global Transaction Services where she is a Product Manager for Import Products and Services. In the International Banking community Charnell is recognized as a Trade Expert with over 34 years of experience. She is on the BAFT-IFSA Board of Directors, the ICC Drafting Committee for ISBP, and serves as an Advisory Member of the Institute of International Banking Law & Practice, Inc.

 Roland Satchell, Global Trade Advisor for Citi.  Roland is Vice President and Global Trade Advisor at Citi. Roland has over 20 years of experience in the financial industry. Over the past 14 years he has been working in Global Trade Operations serving in a number of operational managerial positions. Currently he is the North American Trade Advisory Head and also the Global Trade Advisory Coordinator leading Citi‘s Trade Advisory Global Team of Trade experts.



Contact Roland – – roland.d.satchell@citi.com +1 (813) 604-7183

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These materials are provided for educational and illustrative purposes only and not as a solicitation by Citi for any particular product or service. Furthermore, although the information contained herein is believed to be reliable, the following does not constitute legal advice and Citi makes no representation or warranty as to the accuracy or completeness of any information contained herein or otherwise provided by it.

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Incoterms

 What are they?  What do they mean?

 Why do they exist?
 Main changes of Incoterms 2000 to 2010

 Who uses them?
 Incoterms 2010 – Format and Usage

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What Are They?

 ―Incoterms‖: is an abbreviation of ―International Commercial Terms‖  Published by the International Chamber of Commerce, Paris

 Latest version (effective Jan 01, 2011): ―Incoterms 2010‖

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What Do They Mean?

 Incoterms define at the minimum level – The division of costs between buyers and sellers – The point at which delivery occurs, i.e., the point at which the risk of loss or damage transfers from the seller to the buyer – Which party is responsible for export and import clearance

 Incoterms also give some information regarding documentation, but it is not their primary function

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Why Do They Exist?

 Incoterms have been around since the first version 1936 and has been revised last in 2000. This is now being replaced with the 2010 version  Shorthand form used in Sales Contracts to define the division between buyers and sellers of certain minimum obligations, risks and costs involved in transportation of goods  Incoterms are only applicable when there is a physical movement of goods  Whilst they are mostly used in International Trade, they can be appropriately used for domestic trade as well

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Main changes on the Incoterms® 2010
 Number of Incoterms was reduced from 13 to 11. EXW FAS FOB FCA CFR CIF CPT CIP DAF DES DEQ DDU DDP EXW FAS FOB FCA CFR CIF CPT CIP DAP DAT DDP

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Main changes on the Incoterms® 2010
 Guidance Notes have been included before each rule  Facilitates usage of electronic records if agreed or where customary  Clearly allocates the Terminal Handling Charges (THC) in the relevant terms  For ‗String Sales‘, Incoterms 2010 clarifies the obligation to ‗procure goods shipped‘ as an alternative to the obligation to ship goods  Allocates obligations to obtain or render assistance in obtaining security related clearances

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Purpose of Incoterms

 Main task of Incoterms is to define the sharing of costs and transfer of risk or damage over the goods, up to an agreed place  To avoid misunderstanding and disputes among the parties over the sharing of costs and transfer of risk or damage over the goods

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Who Uses Them?

 Buyers and Sellers, directly  And indirectly  Banks  Insurers  Carriers/Forwarding...
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