Terms of Delivery

Commercial Terms

Terms of delivery

EXW ex works ab Werk

FAS free alongside ship frei Längsseite Schiff

FOB free on board frei an Bord

FCA free carrier frei Frachtführer

CFR cost and freight Kosten und Fracht

CIF cost, insurance, freight Kosten, Versicherung, Fracht

CPT carriage paid to frachtfrei

CIP carriage and insurance paid to frachtfrei versichert

DES delivered ex ship geliefert ab Schiff

DEQ delivered ex quay geliefert ab Kai

DAF delivered at frontier geliefert ab Grenze

DDP delivered duty paid geliefert verzollt

DDU delivered duty unpaid geliefert unverzollt

Note:

The terms can be classified E, F, C and D terms. You can see which category the term falls into from the first letter of the abbreviation. If the terms are listed in the order E, F, C, D, it can be said that with the “E” term, the seller bears the fewest responsibilities, and with the “D” terms, the seller bears the most responsibilities.

E terms: The seller makes the goods available to the buyer at his (the seller’s) works

F terms: The seller has to deliver the goods into the hands of the carrier.

C terms: The seller has to deliver the goods into the hands of the carrier and also to contract for the main carriages.

D terms: The seller has to deliver the goods into the hands of the carrier, to contract for the main carriage, and to bear the risk of transport necessary to convey the goods to the country of destination.

Terms of payment

cash in advance Vorauszahlung, Vorkasse

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cash with order (CWO) Barzahlung bei Auftragserteilung

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payment on receipt of invoice Zahlung bei Rechnungserhalt

payment on invoice

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payment by bank draft on London Zahlung durch Bankscheck auf London

against pro-forma invoice sofort nach Eingang der Proforma-Rechnung

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one third with order, one third on delivery, 1/3 bei Auftragserteilung, 1/3 bei Lieferung, 1/3

and one third within two months after innerhalb von zwei Monaten nach Lieferung

delivery

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cash on delivery (COD) gegen Nachnahme

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payment on receipt of goods Zahlung bei Erhalt der Ware

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payment within 60 days from the date Zahlung innerhalb von 60 Tagen nach

of invoice Rechnungsdatum

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30 days net 30 Tage netto

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two months’ credit 2 Monate Ziel

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strictly net rein netto

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2% for cash 2% Skonto bei Barzahlung

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… less 2% cash discount for payment … abzüglich 2% Skonto für Zahlung innerhalb

within … days … Tagen

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10 days 2%, 30 days net (2/10, net 30) Zahlung innerhalb 10 Tagen abzüglich 2% Skonto

oder innerhalb 30 Tagen netto

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2/10 E. O. M. (end of month)/R. O. G. 2% Skonto für Zahlung innerhalb von 10 Tagen

(receipt of goods) nach Ende des Liefermopnats/ nach Erhalt der Waren

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against three months’ acceptance gegen Dreimonatsakzept

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documents against payment (D/P)/cash Kasse gegen Dokumente

against documents (CAD)

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documents against acceptance Dokumente gegen Akzept

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The shipping documents will be surrendered Übergabe der Versanddokumente erfolgt gegen

against bank acceptance. Bankakzept.

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payment by (ir)revocable and (un)confirmed Zahlung durch (un)widerrufliches und

documentary (letter of) credit (un)bestätigtes Dokumentenakkreditiv

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International Dispatch Documents

Pro-forma Invoice

A pro-forma invoice (sometimes also called “commercial invoice”) may serve as a quotation or a request for payment in advance. It is also used when goods are sent on approval or consigned to an agent for sale.

Consular Invoice

When Country A imports goods from country B, it may first be necessary to have this special commercial invoice signed by a representative of A’s government (i.e. by a consular representative) who lives in B. This gives A better control over the amounts of goods it imports. A consular invoice also prevents “dumping”, i.e. the selling of goods in foreign countries at very low prices.

Bill of Lading (B/L)

An important document issued for shipment by sea. It has three functions:

a) It is a formal receipt issued by the carrier for the goods in question,

b) it is a document giving the importer the right to claim the goods on arrival,

c) it is a document giving evidence of the contract between the exporter and the shipper.

A document stating that the goods are in “apparent good order and condition” is a “clean” bill of lading; if it contains a clause indicating any defect in the condition of the packages, it is called a “foul” (“dirty” or “claused”) bill of lading.

An “airway bill”, on the other hand, accompanies goods sent by air.

Insurance Certificate

An exporter who wants proof of insurance for a shipment has to obtain an insurance certificate. The insurance covers theft and damage during the shipment.

Certificate of Origin

A document showing the origin of goods. It is prepared by the exporter and signed by a Chamber of Commerce or customs officer in the exporting country.

Proof of origin may be necessary because the treatment of foreign goods by the importing countries differs according to the country in which the goods originate.

For example, although Britain might charge import duty on goods from Brazil, it does not do so on goods from Germany. (EU member states do not charge duty on each other’s goods.)