Incolearn- Learning more about Incoterms 2000

EX WORKS (EXW) PART III – The Buyer’s Obligations According to the International Chamber of Commerce (ICC) the first Incoterm Ex Works (EXW), at a named place, is described as “the seller delivers when he places the goods at the disposal of the buyer at the seller’s premises or another named place (i.e. works, factory, warehouse, etc) not cleared for export and not loaded on any collecting vehicle”. Professor Jan Ramsberg, the chairman of the ICC Working Party on Trade Terms, identified ten obligations that the buyer might need to fulfil in terms of Ex Works: (1) the payment of the price; (2) licences, authorisations and formalities; (3) contracts of carriage and insurance; (4) taking delivery; (5) transfer of risks; (6) division of costs; (7) notice to the seller; (8) proof of delivery, transport documents or equivalent electronic message; (9) inspection of goods; and (10) other obligations. The payment of the price requires the buyer to pay the price stipulated in the contract of sale. In respect of the licences, authorisations and formalities, the buyer is required at his own risk and cost to obtain such documentation and authorisation. The buyer has no obligation in respect of the contracts of carriage and insurance. The buyer must take delivery of the goods when they have been delivered in accordance with the contract of sale. As for the transfer of risks the buyer bears all risks of loss or damage to goods from the time of delivery and from the agreed delivery date. In relation to the division of costs the buyer is responsible for all costs relating to their delivery, any additional costs incurred due to the buyer failing to take delivery, and, where applicable, all duties, taxes and other charges payable upon export. The buyer must, if entitled by the contract of sale, give sufficient notice to the seller as to when and where the goods must be placed at his disposal. As for the proof of delivery, transport documents or equivalent electronic message, the buyer must provide the seller with appropriate proof of having taken delivery. The buyer must pay all costs such as pre-shipment inspection in respect of the inspection of goods. As for other obligations, the buyer must pay all costs incurred to obtain the relevant documentation and also reimburse the seller for any costs incurred in rendering such assistance. Next weeks we will provide a summary of the Ex Works (EXW) term.