TREASURY CLASSROOM VOLUME 67

INCOTERM- COST, INSURANCE AND FREIGHT

Now this incoterm assumes the maximum responsibility of the seller(Exporter) as in this the insurance, ocean freight charges are also borne by the exporter. Now this term is mostly used in the import and export transactions. And the major charges that are borne by the buyer are transportation charges from port to the factory. Like for example buyer port is located in USA and from USA port to his factory transportation charges are borne by the buyer also addition to this the charges which are borne by the buyer are customs clearance loading and unloading charges on the port.

Now here is a list of consolidated charges borne by the seller that is warehouse charges, customs clearance, terminal charges, charges for loading on to ship, ocean freight charges(Sea transportation charges from Sellers port to buyer port), insurance(Exporter has to obtain insurance at his own cost against the risk of damage of goods), inland transportation charges from sellers factory to seller port. Now this term sounds more practical as compared to the Cost and freight( In this insurance is not involved).

Note; it is only used for the inland and waterway transport. And generally it is used in the bulk cargos and non-containerised cargo. And the major documents like that exporter has to handle to importer are ocean bill of lading, packing list, commercial invoice.

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