The nature of international trade changes, and with it, the need to update a fundamental mechanism to facilitate negotiations and contracts: Incoterms. 1 January 2020, these new standards will enter in force. The International Chamber of Commerce is currently giving them the final technical touches.
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INCOTERMS 2022 & Letter of Credit
What are Incoterms?
Incoterms came about in 1936 in order to improve negotiations between exporters and importers. They seek to provide perfect understanding between the different parties involved in an international trade action, overcoming hurdles such as language or different laws in different countries.
It should be noted that it is not mandatory to comply with them but are rather standards that parties voluntarily accept regarding freight delivery conditions, liabilities and the costs entailed by the transaction.
What are Incoterms® rules?
ICC’s Incoterms® rules are the world’s essential terms of trade for the sale of goods. Whether you are filing a purchase order, packaging and labelling a shipment for freight transport, or preparing a certificate of origin at a port, the Incoterms® rules are there to guide you. The Incoterms® rules provide specific guidance to individuals participating in the import and export of global trade on a daily basis.
Who publishes the Incoterms® rules?
Since its founding in 1919, ICC has been committed to the facilitation of international trade.
Different practices and legal interpretations between traders around the world necessitated a common set of rules and guidelines. As a response, ICC published the first Incoterms® rules in 1936. We have been maintaining and developing them ever since.
As ICC celebrates its Centenary in 2019, the world business organization is pleased to announce the preparation and publication of Incoterms® 2020. This newest edition of the Incoterms® rules will help prepare business for the next century of global trade.
Why use Incoterms® rules in international trade?
Although other clauses for global trade exist around the world, such as the Harmonised Tariff Schedule of the United States, Incoterms® rules are global in their reach. Similarly, Incoterms® rules do not include trade terms codified for national purposes, such as the “less than truckload shipping” (LTL) rule of the United States. Unlike national trade policies, Incoterms® rules are universal, providing clarity and predictability to business.
When were ICC’s Incoterms® rules last updated?
ICC last updated the Incoterms® rules in 2010. Incoterms® 2010 is still in effect today and can be accessed under our resources for business.
What happened to Incoterms 2015, Incoterms 2016, Incoterms, 2017, Incoterms 2018, and Incoterms 2019…?
Don’t worry, you didn’t miss them. They do not exist! The latest edition of the Incoterms® rules is Incoterms® 2010.