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5. CFR (or C & F) "Cost
and Freight" requires the seller to pay the costs and
freight necessary to bring the goods to the named destination,
but the risk of loss or damage to the goods, as well as any
cost increases, are transferred from the seller to the buyer
when the goods pass the ship's rail in the port of shipment.
Insurance is the buyer's responsibility.
6. CIF "Cost, Insurance, and Freight"
this is CFR with the additional requirement that the seller
procure transport insurance against the risk of loss or damage
to goods. The seller must contract with the insurer and pay
the insurance premium. Insurance is generally important in
international shipping because transport companies have restricted
liability for loss or damage.
7. CPT "Freight/Carriage Paid
To" or DPC. This
term means the seller pays the freight for the carriage of
the goods to the named destination. The risk of loss or damage
to the goods and any cost increases transfers from the seller
to the buyer when the goods have been delivered to the custody
of the final carrier, and not at the ship's rail. Accordingly,
"freight/carriage paid to" can be used for all modes
of transportation, including container or roll-on roll-off
traffic by trailers and ferries. When the seller is required
to furnish a bill of lading, way bill, or carrier receipt,
the seller duly fulfils its obligation by presenting such
a document issued by the person contracted with for carriage
to the main destination.
8. CIP "Freight/Carriage And Insurance
Paid To" . This term (also abbreviated CIP) is
the same as "freight/carriage paid to" but with
the additional requirement that the seller has to procure
transport insurance against the risk of loss or damage to
the goods during the carriage. The seller contracts with the
insurer and pays the insurance premium.
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