Incoterms 2020: EXW and DDP to potentially be removed and FOB maybe allowed for Ocean Freight once again.

The international trade community news feeds are a buzz as committee of experts from the International Chamber of Commerce (ICC) which now includes representatives from China and Australia are discussing changes for the next revision of Incoterms 2020.

The new Incoterms are expected to appear in the last quarter of 2019 and will enter into force on January 1, 2020.

  • Some of the new changes that are being evaluated are the removal of EXW and DDP Incoterms. The case for removal is that they were originally intended to be used for domestic operations but have been used outside the intended purpose by many companies with little export experience. DDP may be replaced with two similar Incoterms, DPP and DTP.
  • The ICC committee is looking to modify the FOB incoterm 2020 to be allowed to be used once again for containerized shipping, as was the case in previous versions of Incoterms.
    • When it comes to FOB vs. F.O.B. there has been plenty said about the confusion of these terms within the USA since the Incoterm FOB properly used is for ocean freight only and should name a port in the origin country where delivery occurs (delivery defined within Incoterms as when the cost and risk transfer from seller to buyer).

To manage your Costs and Risks appropriately contact our Operations team at 800-508-4888 or OPS@ACSSAN.COM to book your next shipment using the proper Incoterm!