05 Dec New Incoterms as per Jan 2020
New Incoterms® 2020 as per January 2020
The international Chamber of Commerce (ICC) has recently launched Incoterms® 2020, the newest edition of its renowned trade terms for the delivery of goods, providing certainty and clarity to business and traders everywhere.
Definition Incoterms rules
The Incoterms rules are the world’s essential terms of trade for the sale of goods. Whether you are filing a purchase order, packaging and labeling 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.
Why use Incoterms rules in international trade?
Although other clauses for global trade exist around the world, such as the Harmonized 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.
History of the Incoterms
The Incoterms rules were first introduced by the ICC in 1936 to establish commonly accepted definitions and rules related to the delivery of goods between trading partners worldwide. Since then, the ICC has periodically revised the Incoterms rules to reflect changes in the international trade system.
More accessible and easier to use, Incoterms 2020 includes more detailed explanatory notes with enhanced graphics to illustrate the responsibilities of importers and exporters for each Incoterms rule. The introduction to Incoterms 2020 also includes a more detailed explanation on how to choose the most appropriate Incoterms rule for a given transaction, or how a sales contract interacts with ancillary contracts.
Launch of the new version
This new version of the international commercial terms comes into effect on January 1, 2020. Please note that all contracts made under Incoterms 2000 and any other previous editions remain valid and parties to a contract for the sale of goods can agree to choose any version of the Incoterms rules. However, it’s advisable to use the most current version of the rules, Incoterms 2020. Nevertheless, it is important to clearly specify the chosen version.
The ICC world business organization is the largest business organization in the world and represents more than 45 million companies from over 100 countries. Through a unique blend of advocacy and development of standards, ICC promotes international trade, corporate social responsibility and an international level playing field for legislation.
Changes for your business
If you you require more information or would like to know the implication of the changed incoterm(s) for your business, please let us know via our contact form. Our consultants are happy to advise you.