Logistics
Incoterms
Also known as: International Commercial Terms, ICC Incoterms
International rules published by the International Chamber of Commerce (ICC) defining buyer and seller responsibilities for transport and delivery of goods.
Also known as: International Commercial Terms, ICC Incoterms
International rules published by the International Chamber of Commerce (ICC) defining buyer and seller responsibilities for transport and delivery of goods.
Incoterms (International Commercial Terms) are a set of rules published by the International Chamber of Commerce (ICC) that standardize the obligations, costs, and risks between buyers and sellers in international trade. The current version, Incoterms 2020, took effect on January 1, 2020.
The Incoterm used in a transaction determines which cost components are included in the transaction value and therefore directly affects the dutiable base for calculating tariffs and taxes. For example, under CIF the freight and insurance are already included; under FOB, they must be added separately.
In Mexican foreign trade practice, the most common Incoterms are FOB (Free on Board), where the seller delivers goods on board the vessel and the buyer assumes costs and risks from that point; CIF (Cost, Insurance and Freight), which includes freight and insurance to the destination port; EXW (Ex Works), where the buyer assumes all costs from the seller's facility; and DDP (Delivered Duty Paid), where the seller assumes all responsibilities to the destination in Mexico, including duties.
Customs Value
The monetary amount on which import duties are calculated, determined according to the WTO Valuation Agreement with transaction value as the primary method.
DocumentsCommercial Invoice
Document issued by the seller/exporter describing the goods sold, their price, terms of sale, and details of the parties involved.
TradeDefinitive Import
Customs regime allowing foreign goods to enter and remain indefinitely in the country after payment of all applicable duties and taxes.