With the creation of Incoterms, the understanding between countries regarding international trade, logistics and transportation has been facilitated, since these tools, often used in commercial contracts, ensure a single way of interpreting the terms of negotiation and contracting.

All actors, both buyers and sellers in the trade are the beneficiaries, as businessmen, traders, importers, exporters, and customs brokers, with the implementation of better rules for the interpretation of terms, have saved time and most importantly money that was often lost before due to misinterpretations of contractual terms.

In this way, Incoterms have eliminated important barriers to trade. The transfer of liability is also one of the most important benefits offered by the application of Incoterms. Since these terms are so explicit in determining the specific place and time at which liability is transferred between buyer and seller, serious inconveniences are avoided.

The benefits generated by Incoterms include the following: simplification of the contractual terms of trade, standardization of concepts, clear definition of responsibility between the parties and response to legislative differences.

Finally, with regard to legislative differences, Incoterms, although they do not offer a final solution to this problem, facilitate the avoidance of such problems with the clear establishment of terms of reference, eliminating legal loopholes that previously fell into the hands of legislative differences, strongly complicating commercial processes.

In short, if the use of Incoterms is interpreted correctly, one of its virtues would be to comply in time and form with the stipulations that each one marks, demonstrating to the buyer and seller a good commercial exchange.

Through our specialist advisors at Foster Swiss you can obtain more information on this subject or any related question about our services, please contact us directly at: info@fosterswiss.com