Common Incoterms in International Trade (EXW / DAP / DDP)

What are Incoterms

Incoterms are internationally recognized rules created by the International Chamber of Commerce (ICC) to define responsibilities, costs, and risks between buyers and sellers in global trade.

The most commonly used terms are EXW, DAP, and DDP.

EXW (Ex Works)

EXW is the term where the seller has minimal responsibility.

The seller only needs to make the goods available at their premises. After that, the buyer handles all transportation, export procedures, and import clearance.

Risk transfers to the buyer once the goods are collected.

DAP (Delivered at Place)

Under DAP, the seller is responsible for delivering the goods to a specified destination.

All costs and risks remain with the seller until the goods arrive at the destination and are ready for unloading.

Risk transfers to the buyer upon arrival.

DDP (Delivered Duty Paid)

DDP places full responsibility on the seller.

The seller covers transportation, export clearance, import clearance, and all duties until the goods are delivered.

The buyer only receives the goods at the destination.