Incoterms® 2020 for UK businesses

Current edition

Incoterms® 2020 remains the current ICC edition reviewed for this release on 3 October 2026. Put the three-letter rule, the precise named place or port and “Incoterms® 2020” into the quotation or contract. A loose phrase such as “FOB UK” or “DDP customer” leaves too much open.

The 11 rules

Any mode or modes of transport: EXW, FCA, CPT, CIP, DAP, DPU and DDP.

Sea and inland waterway only: FAS, FOB, CFR and CIF. These maritime rules are built around delivery alongside or on board a vessel at a port.

That split matters. A shipment can travel by sea without automatically making FOB, CFR or CIF the best fit. If containerised cargo is handed to a carrier at an inland depot or container terminal before vessel loading, an any-mode rule may better match the physical hand-off.

Match the rule to the transport mode

• Road: use an any-mode rule — EXW, FCA, CPT, CIP, DAP, DPU or DDP.
• Air: use an any-mode rule. FOB/CIF language is not designed for airport hand-offs.
• Rail: use an any-mode rule, including where rail is one leg of a multimodal movement.
• Courier / parcel: use an any-mode rule and make duty/tax billing match the customer promise.
• Sea / inland waterway: maritime rules can be used where delivery occurs alongside/on board the vessel; any-mode rules can also be appropriate depending on the actual delivery point.
• Multimodal: use the any-mode group so the contract can follow the carrier hand-off across combined legs.

Who pays the freight is not always who carries the risk

CPT, CIP, CFR and CIF are the classic trap. The seller pays carriage to a named destination, but risk transfers earlier at the delivery point defined by the rule. A quote can therefore be “freight paid” without the seller carrying transit risk all the way to destination.

DAP, DPU and DDP work differently: risk stays with the seller until the named destination. Under DPU the seller also unloads. Under DAP and DDP the goods are delivered ready for unloading.

Customs responsibilities

EXW is unusual because the buyer carries export-clearance responsibility under the standard rule. DDP sits at the other extreme: the seller takes import-clearance and import-charge responsibility. Those positions still have to be legally possible in the countries involved. A three-letter term cannot create an EORI, VAT registration or importer eligibility that does not exist.

Example: sea shipment, wrong term

Before you agree a term

• Write the full named place or port, not just a city or country.
• Confirm the physical delivery point and who controls the main carriage.
• Check export and import-clearance eligibility.
• Separate risk transfer from who pays freight.
• Confirm insurance, unloading, terminal and destination charges.
• Write down any variation to the standard rule.
• For marketplace/consumer sales, make the operational carrier instruction match the customer-facing promise.