Question

Compared to the 2010 Incoterms convention, there are 4 changes in the 2020 Incoterms convention. Vrai Faux

Answer 1

The year 2020 is one of the most eventful new years the international shipping industry has ever witnessed. Incoterms 2020 goes into effect on New Year's Day.

Incoterms rules issued by the International Chamber of Commerce since 1936, standardize international deals with terms that define who, whether seller or buyer, is accountable for the various portions of transportation and insurance of goods (ICC Academy). The Incoterm rules are the world's crucial terms of trade for the export and import of goods and guide people participating in global trade.

CHANGES IN INCOTERMS 2020

• The rule DAT (Delivered at Terminal) has been renamed DPU Delivered at Place Unloaded (M6T, 2019). This name change emphasizes the place of destination could be any place and not just at a transport "terminal".
• For the Carriage and Insurance Paid (CIP), the level of freight insurance is now Institute Cargo Clauses (A) and not the lower level Institute Cargo Clauses (C) specified in Incoterms 2010. For Cost Insurance and Freight (CIF), the default level of cover has remained unchanged at Institute Clauses (C).
• In the Incoterm 2020, FCA (Option of Bill of Lading with the Onboard Notation) rule is used in conjunction with a letter of credit, so that the buyer should instruct the carrier to issue the seller a Bill of Lading with the annotation of "aboard" which specifies that the goods have been loaded aboard the ship.
• The Incoterm 2020, rule as regards to security is addressed under two circumstances-

- During the transport of goods from the country of origin to that of destination, the security liability is undertaken by the party responsible for executing the carriage of goods contract.

- The safety liability in custom clearance formalities and procedures lies with the party which undertakes the clearance.