国际贸易实务双语教程全套教学课件

国际贸易实务双语教程

ABilingualTextbookofImportandExport全套可编辑PPT课件Chapter1AnOverviewoftheExportProcess1.1ThreeWaystoGetGoingExportinYourFirm’sOwnNameYoumustregisterbyfillingouttheFormforRegistrationasaForeignTradeDealer,andobtaintherightforimportandexport.Figure1-1TheFormforRegistrationasaForeignTradeDealer对外贸易经营者备案登记表ExportThroughaTradingCompanyYoucanexportthroughatradingcompany--anothercompanywithsuchaqualification,thenallformalitiesarecompletedbythiscompanyandexportisdoneinitsname.ASOHOModeforExportSmallexporterscanadoptaSOHO(smallofficeandhomeoffice)modeforexportbymakinguseofexistingsocialnetworks,orcross-bordere-commerceplatformssuchasAlibaba,AliExpressorAmazonanddeliverviainternationalcouriers.1.2BasicProcessofExportSourcingleadssigningcontractdeliveringgoodscollectingpayments1.3TwoStagesofExport1.4FulfillinganInternationalOrderDifferencesbetween

InternationalTradeandDomesticTradeOverall,internationaltradeismorecomplicatedandofhigherriskthandomestictrade.Reason:moreopenandspreadsfartheraroundtheglobe,reachinghighlydiversifiedmarketswithmuchmorecomplexbusinessenvironment.Differencesreflectedin:languages,cultures,currencies,laws,regulationsandtradeconventions,longdistancesandriskierlogisticsprocess,difficultiesinmarketresearchetc.1.4.1AcquiringTradeLeadsInternationalbuyersandsellersseldommeet,unlessnecessary.Majorchannelsforacquiringtradeleads:fax,phone,searchengines,emails,socialmediaplatforms,video-conferencingapps,etc.1.4.2

ObtainingLicenseandQuotasPurpose:limitingtheimportofcertaincategoriesofgoodsAquotaisthelimitedquantityofsomethingthatisofficiallyallowedforimportorexport.Makesureyouhaveobtainedthelicenseandquotaifnecessarybeforesigningthecontract1.4.3InspectionandClearingtheCustomsYoucannotmovegoodsacrossnationalorcustomsborderswithoutpermissionoftheCustoms.functionsoftheCustomsinimport&export:supervisingthemovementofgoodsacrossnationalorcustomsborders,collectingimportandexportdutiesandothertaxes,preventingsmugglingandcompilingbusinessstatistics,etc.CommodityinspectionnowisnowafunctionoftheCustoms.Someinspectionsaremandatory—statutoryinspection.Certificateoforiginissometimesrequired.1.4.4

DocumentationandPresentationcommercialdocuments,e.g.theinvoice,financialdocumentse.g.theletterofcreditanddraft,shippingdocumentse.g.thebillofladingandthepackinglist,insurancedocumentse.g.theinsurancepolicy,inspectioncertificatemayberequiredbytheimporter,theexportingcountryortheimportingcountry.sellers,buyers,governmentauthorities,banks,theshippingcompany,theinsurancecompany,etc.mayrequirethedocuments.1.4.5ShippingtheCargoMostlythroughafreightforwarderObtainsbillofladingYousendthebilloflading,viaotherpartieswhennecessary,totheconsigneeforhim/hertotakedelivery.1.4.6

CollectingthePaymentPaymentismostlyinforeignexchanges.TheStateAdministrationofForeignExchangesupervisesexporters’bankaccountforreceiptofthisrevenue.1.4.7

GettingTaxRefundOnceyourtransactionisverifiedbytheCustomsandtherevenuereportedtoSAFE,theStateTaxationAdministrationrefundsacertainamountofvalue-addedtaxthatyouhavealreadypaidifyourcategoryofproductiseligible1.5CaseStudy:YourRoutineWorkAUSoutdoorretailerhasordered1,000tentsandrequiredshipmentbemadebeforeOct.20thfromthePortofQingdaotothePortofLongBeach.ExportinYourFirm’sOwnName1.AroundOct.10th,youphone/faxthefreightforwardertobooktheshippingspaceandgetyourgoodstothedesignatedlocation(warehouse)asrequiredbytheforwarder.2.Prepareasetofinvoicesandpackinglistsandsendthemtothefreightforwardertogetherwithaletterorauthorizationforinspectionandcustomsclearance,authorizingwhichtotheforwarder.However,youmayalsocompleteinspectionandcustomsclearanceonyourown.3.Getthebillofladingfromtheforwarderoncethelatterreceivesthegoodsandcompletesthecustomsformalities;prepareanothersetofinvoicesandpackinglistsaswellasotherdocumentsrequiredbytheimporter.4.Notifytheimporteroftheshipmentofgoodsandaskforpayment;sendthewholesetofdocumentstotheimporter,oftenthroughthebankingsystem.6.Workdone.CollaboratewithaTradingAgency1.Notifytheagencyoftheorder.2.AroundOct.10th,notifytheagencythat“thegoodsareready”.3.Getthegoodstothedesignatedlocation(warehouse)asrequiredbytheagency.4.Workdone.Payment,oncereceivedfromtheimporter,willbeconvertedtoRMBandcreditedintoyourbankaccountbytheagency.Thisisthecasewhennoinspectionorquotaisrequired,otherwise,inspectionhastobecompletedandquotaobtainedbeforeOct.10th.Chapter2InternationalMarketResearchandDevelopment

2.1InternationalMarketResearchWhyisinternationalmarketresearchnecessary?First,internationalbusinessisgenerallyriskierthandomesticbusinessduetoitshigheruncertainties.Second,youneedatailoredmarketingendeavortargetingatdifferentprospects(潜在客户).2.1.1GoalsofInternationalMarketResearchGoalsofInternationalMarketResearchcontrollingrisklocatingyourtargetcustomerConductingresearchattwolevels:Amacro-environmentresearch—aPESTanalysisofyourmarketAmicro-environmentresearch–athoroughunderstandingofyourtargetcustomer2.1.2MethodsofInternationalMarketResearchDesktopresearch:Definition:itexploitsexistingresourcesfortheissuesinquestion.Advantages:readilyavailable,cost-effectiveDisadvantages:lesstargetedFieldResearch:Definition:itgathersfirst-handinformationforaspecificquestionoraseriesofquestions.Advantages:moretargetedandtailoredtoDisadvantages:expensive,time-consuming,resultsnotreadilyavailable2.2WatchingforExportRiskMajorTypesofExportRisksPoliticalriskLegalriskCommercialandcreditRiskCargoriskForeignexchangerisk2.3SourcingInternationalTradeLeadsSourcesofInternationalTradeLeadsCompanywebsitesB2BplatformsSearchenginesTradeassociationsYellowpagesTradefairsChineseembassiesandforeignembassiesSocialmediaplatformsCustomsdatabasesandcommercialdatabasesOthersourcesoftradeleads2.4EstablishingBusinessRelationsMajorWaysofEstablishingBusinessRelationswritinganemail(directemailmarketing)addingconnectionsatasocialmediaplatformsendingafaxmakinganinternationalphonecallattendingatradefair,…BasicPrinciplesforanEffectiveEmailBackground:

shorter

attention

span

in

reading

emails;

differencesbetweenhigh-contextandlowcontextculturesPrinciples:draftashortandattractivesubjectline;beshortandconcisewithyourmainbody;stressyourstrengthbriefly;usesimplewordsincasethereceiverisnotanativespeakerofEnglish;endyouremailwithacalltoaction.Chapter3BusinessNegotiationsandSigningtheContract

3.1ContentsandFormsofBusinessNegotiationsContentsandFormsofBusinessNegotiationsContents:product,price,quality,quantity,timeandplaceofdelivery,termsofpayment,inspection,resolvingdisputes,etc.Forms:Internationalnegotiationscanbeconductedorally,inwriting,orindicatedbyactsTheUnitedNationsConventiononContractsfortheInternationalSaleofGoods(CISG)TheCISG(TheViennaConvention)isanimportantinternationalconventionthatgovernsthemajorityofinternationalsalesofGoodsIthasbeenratifiedby94countriesasof2020,representingtwothirdsofworldtrade.Itisamultilateralconventionthatestablishesauniformframeworkforinternationalmerchandisetrade.3.2GeneralProceduresofBusinessNegotiationsGeneralProceduresofBusinessNegotiationsEnquiryOfferCounter-OfferAcceptanceEnquiryAskingaboutthetermsofatransactionBothbuyerandsellercanmakeenquiriesOrallyorinwritingwithnofixedformatNotindispensableNotbindingtoeitherbuyerorsellerExample:“PleasequotethepriceofCIFLondonforChineseRosin,Juneshipment.”“CansupplyChinesecotton,Octobershipment.Ifinterested,pleasefaxoremail.”OfferDefinition:Anofferisabusinessproposalmadebytheexporterorimportertoexpresshis/herwishtosellorbuyparticulargoodsunderstatedterms.BothbuyerandsellercanmakeoffersLegallybindingtotheofferorCriteriaforabusinessproposaltobeanoffer:aspecificaudienceClearintentionorreadinesstoexecutethedealunderproposedtermsTheso-called“indefiniteoffers”or“non-formoffers”inpracticeareessentiallynotoffersbythestandardsofCISG.CISGArticle14(1):“Aproposalforconcludingacontractaddressedtooneormorespecificpersonsconstitutesanofferifitissufficientlydefiniteandindicatestheintentionoftheofferortobeboundincaseofacceptance”.CISG14(2):“Aproposalotherthanoneaddressedtooneormorespecificpersonsistobeconsideredmerelyasaninvitationtomakeoffers,unlessthecontraryisclearlyindicatedbythepersonmakingtheoffer”.Howtointerpret“definite”?CISGArticle14(1):“aproposalissufficientlydefiniteifitindicatesthegoodsandexpresslyorimplicitlyfixesormakesprovisionfordeterminingthequantityandtheprice”.DifficultiesinapplicationWordsforreference“subjecttoourfinalconfirmation”or“forreferenceonly”AskforclarificationifyouarenotsureAnoffergenerallyhastofixaperiodforacceptance.Anoffertakeseffectwhenitreachestheoffereeandhis/heracceptancewithinthatperiodisconsideredeffective.(Article15(1)ofCISG)Anoffercanbewithdrawn“ifthewithdrawalreachestheoffereebeforeoratthesametimeastheoffer.”(Article15(2)ofCISG).“Untilacontractisconcluded,anoffermayberevokediftherevocationreachestheoffereebeforehehasdispatchedanacceptance.”(Article16(1)ofCISG)Butanoffercannotberevokediftheofferhasfixedaperiodoftimeforacceptance,orhasindicatedbyothermeansthatitisirrevocable.Ifitisreasonablefortheoffereetorelyontheofferasbeingirrevocableandhe/shehasactedinrelianceontheoffer,itcannotberevoked,either.whenarejectionreachestheofferor,theofferisterminated,evenifitisirrevocable.Counter-offerDefinition:counter-offerisareplytoanofferwithadditions,limitationsormodifications.Bothbuyerandsellercancounter-offertheother’sofferorcounter-offer.NotindispensableAcounter-offercancelstheoriginalofferandconstitutesanewone.AcceptanceDefinition:Anacceptanceisthefinalanddefiniteexpressionofassenttothetermsofanofferoracounter-offer,togetherwithpreviouslyagreeduponterms.Bothbuyerandsellercanmakeacceptance.Format:instatementorindicatedbyanact;Silenceorinactivitydosenotinitselfamountstoanacceptance.Mustbeaddressedtoaspecificaudience—individual(s)orbusiness(es)Anacceptancemustbedeliveredbeforetheofferexpires.Islate“acceptance”effective?GenerallyNo.Unlesstheotherpartyacceptsyourlate“acceptance”byinformingyouorallyorsendingyouanoticetosaysowithoutdelay.Butincaseyourmeansofcommunicationissolelyresponsibleforthedelay,yourlate“acceptance”isstillregardedaseffective,unlesstheotherpartythinksotherwiseandtimelyinformsyouofhis/herdecision.Anoraloffermustbeacceptedimmediatelyunlessthecircumstancesindicateotherwise.Anacceptancecanbewithdrawnbeforeoratthesametimeitreachestheotherparty,butyouneedafastermeansofcommunicationforsendingthewithdrawal.Don’tmistakesomecounter-offersforacceptances.Anacceptancemustbeinstrictaccordancewiththeoffer.Anymodificationaltersanoffer.Materialmodificationsturnitintoacounter-offer.price,payment,qualityandquantityofthegoods,placeandtimeofdelivery,extentofoneparty’sliabilitytotheotherorthesettlementofdisputesnon-materialmodificationskeepitasanacceptance,unlesstheofferorobjectstothemwithoutdelay.3.3SigningBusinessContractFormatof

an

InternationalContractTheformattendstobemoreflexiblethanthatofdomesticcontracts,whichcouldbe:atraditionalcontractasalesconfirmationapurchaseconfirmationanagreement,oraconfirmedproformainvoice.MajorElementsofaBusinessContractNameandaddressoftheexporterandimporterDateandlocationofsigningthecontractThewillingnessandguaranteeofbothsidestocarryoutthecontractProductdescription:name,model,quality,quantity,packagingandmarking,etcofthegoodsUnitpriceandtotalamountTermsofpaymentMajorElementsofaBusinessContractTimeofshipmentPortofloadingandportofdestinationInsuranceInspectionDocumentsrequiredbytheimporterComplaintor

claimDisputeresolutionForcemajeureRemarksSignatureChapter4DescriptionofCommoditiesMajorAspectsin

DescribingYourProductinaContractNameModelQuantityQualityPackagingMarking…ProblemswithdescribingquantityandqualityPeoplearoundtheworldmightusedifferentsystemsofmeasurementorstandardstodescribeproductquantityandquality.4.1MeasuringQuantities4.1.1MeasurementSystemsinInternationalTradeMetricSystemBritishImperialSystemU.S.CustomaryMeasurementSystemsInternationalSystemofUnits(SIforshort)

APintofBeer/story/pulling-a-fast-one-a-pint-of-beer-costs-60p-more-than-what-people-think-it-should-11391514AYardofClothGallon,Quarts,Pints,Cups,OuncesYards,FeetandInchesThreeTypesofTonswithintheSo-Called

EnglishSystemofMeasures1)Theshortton,ameasureofweight,=2000ponds2)Thelongton,ameasureofweight,=2240pounds3)Thegross(registered)ornetton,ameasureofvolume,=100cubicfeetThreeTypesofPoundswithintheSo-Called

EnglishSystemofMeasures1)aunitofweightequalto16oz.avoirdupois[ˌævərdəˈpɔɪz](0.4536kg)重量单位，1磅等于16常衡盎司，即0.4536kgavoirdupois[ˌævərdəˈpɔɪz][U]常衡（以磅为单位的衡制）thesystemofweightsbasedonthepound2)aunitofweightequalto12oz.Troy(0.3732kg)重量单位，1磅等于12金衡盎司，即0.3732kgTroy[U]金衡制（用于称量贵重金属和宝石）asystemformeasuringpreciousmetalsandpreciousstones3)(亦作poundsterling)(pl.poundssterling)thebasicmonetaryunitoftheUK,equalto100pence镑（英国货币单位，1镑等于100便士）FiveTypesofOunceswithintheSo-Called

EnglishSystemofMeasures1)Anavoirdupoisweightunitof437.5grains

avoirdupois：[ˌævərdəˈpɔɪz]n.常衡，以磅为单位的衡制，英语国家广泛使用的重量体系：1磅=16盎司=7000格令grains：格令〔英美重量最低单位，略作gr.＝64.8毫克或1/7000磅〕1ounce=28.35grams2)AnapothecaryorTroyweightunitof480grains.Apothecary[əˈpɑ:θəkeri]n.药剂师，药店Troyn.金衡〔金、银、宝石的衡制〕1ounce=31.1035gramExamplesofItemsThatWeighanOunceundertheStandardsCDcaseCDwithoutthecaseRegular-sizeletterSliceofbreadStandardinkpenOnceSliceofBreadOneOunceofWeedOneOunceofGoldFluidOunce3)AU.S.fluidounce,beingameasureofvolumewhichisworthsixteaspoons.4)Animperialfluidounce,being4percentsmallerthantheU.S.unit.ExamplesofaFluidOunceOne-eighthcupofwaterSixteaspoonsofhoneyTwotablespoonscoughsyrupFluidOunceTeaspoon,TablespoonandMLLeatherMeasuredinOunce5)LeatherismeasuredintheUnitedStatesinounces,which,inthiscase,isameasurenotofweightnorofvolume,butofthickness:Two-ounceleathersuchascalforgoatskinisabout1/32inchesthickEight-ounceleatherisafull1/8inches.TwoTypesofGallonAunitofvolumeforliquidmeasureequaltoeightpints,inparticular4.1.2MethodsforCalculatingWeightGrossWeightNetWeightConditionedWeightTheoreticalWeightLegalweight4.1.3QuantityToleranceDefinition:Quantitytoleranceisaallowedrangeofthevarianceinquantityofthegoodsdelivered.“MoreorLess”ClauseinaContractThreeelements:1st,theallowedrangeofvarianceinquantity2nd,thepartywhodeterminesthequantitytobedelivered3rd,thepriceusedtocalculatethevalueoftheover-loadorunder-loadportionofthemerchandise.Example:“Quantity:100,000M/T,5%moreorless,atexporter'soptionandatcontractprice.”QuantityToleranceStipulationsinUCP600：article30a:Thewords"about"or"approximately"usedinconnectionwiththeamountofthecreditorthequantityortheunitpricestatedinthecreditaretobeconstruedasallowingatolerancenottoexceed10%moreor10%lessthantheamount,thequantityortheunitpricetowhichtheyrefer.article30b:Atolerancenottoexceed5%moreor5%lessthanthequantityofthecommoditiesisallowed,providedthecreditdoesnotstatethequantityintermsofastipulatednumberofpackingunitsorindividualitemsandthetotalamountofthedrawingsdoesnotexceedtheamountofthecredit.4.2MeasuringQuality4.2.1MethodsforMeasuringQualityMeasuringqualitybyCommoditiesperseMeasuringqualitybyinspectionMeasuringqualitybysample:Asampleisasmallquantityofproductsrandomlytakenoutfromawholelot,orspecificallydesignedandprocessedforacustomerforreferenceorforconfirmationbeforemassproduction.aseller’ssampleabuyer’ssampleareturnsampleMeasuringqualitybycommoditydescriptionsspecificationsgradestandardtrademarkorbrandplaceoforigintechnicaldescriptions4.2.2QualityTolerance:Definition:Qualitytoleranceistheallowedvarianceordeparturefromaspecificationorstandardthatisconsiderednotaffectingtheproperfunctioningoftheproduct.Generally,thetoleranceisstipulatedintermsofanallowedrangeorlimitforthekeyindicatorsofquality,whichcouldbearecognizedoneintheindustryoragreeduponbybothbuyandseller.CasesofQualityToleranceCase1:specificationofwool:moisture5%-10%Case2:specificationsofwheat:brokengrains(Max)25%,admixture(Max)0.5%,moisture(Max)15%.Case3:specificationofeiderdowncoat:eiderdown80%,1%moreorless.4.3PackagingforExportFunctionsofPackagesprotectacommoditypromotesalesfacilitateidentificationandaccelerateimporter’stakingdeliveryRequirementsforPackagingPackagingthegoodsinawaytomeettherequirementsforbothinternationalshippingandmarketing.PackagingatThreelevels:theprimarylevel(tomeettherequirementsforretailing)thesecondarylevel(tomeettherequirementsforwholesaling)thetertiarylevel(tomeettherequirementsforinternationalshipping)Markingyourpackagesproperlyalsohelpstoachievingthefunctionsofpackaging.4.3.1PackagingforTransportationindividualpackages:cartons,woodencases,crates,barrels,bags,cans,bales,bundles,etc.collectivepackages:containersandpallets,etc.Requirements:besturdyenoughImpactofpoorpackaging:thebanker’srefusaltomakepaymentinthecaseofapaymentmethodbyletterofcredit.aclaimfordamagetoorlossofgoodsduetopoorpackagingwillnotbesupportedbytheinsurancecompany.4.3.2PackagingforSalesFunctions:helptosellproductsbyprovidingproductdifferentiation,brandawarenessandconvenience.Considerations:Thepackageshouldfacilitatearetailerorwholesaler’shandlinganddisplayfacilitateaconsumer’sidentification,takingalongandusebeartisticallyappealinginappearance.4.3.3MarkingsSignificanceofaclear,

correct

and

complete

marking

of

the

package—ithelpstopreventincorrecthandlingordelivery,theft,customsfineinjurytoworkers.TypesofMarkingsISO780etc.suggestacompletemarkinggenerallycomprises--Informationmarkstellthecountryoforigin,weightanddimension,whichfacilitatecustomsclearance,transportationandhanding.HandlingmarksinstructworkerstoexertcarewithcargohandlingandstorageShippingmarksfacilitateidentificationofthecargoandpreventsmistakesinloadingorunloadingHandlingMarksShippingMarks

AtypicalshippingmarkMajorelementsimporter'sinitialsdestinationpackageserialnumbercontractnumberChapter5InternationalCommerceRulesandExportPricesandEarnings5.1InternationalCommerceTerm5.1.1ComplexitiesofInternationalLogistics

Whowillresponsibleforwhat?Difficultiesindivisionofcost,risksandobligations5.1.2

SolutionsbyIncoterms2020RulesWhatisIncoterms2020?asetofstandardizedtermsoftradecreatedbytheInternationalChamberofCommercein1936whichhaveevolvedintoelevenInternationalCommerceTermsRules,orIncotermsforshortandareillustratedinthepublicationofInternationalRulesfortheInterpretationofTradeTerms.Revisedin1953,1967,1976,1980,1990,2000,2010andmostrecentlyin2020.FunctionsofIncotermsRulesAnIncoterms2020ruledefinesfiveaspectsofaninternationalsale:-Whichtaskwillbeperformedbytheexporter?-Whichtaskwillbeperformedbytheimporter?-Whichactivitieswillbepaidbytheexporter?-Whichactivitieswillbepaidbytheimporter?-Whenthetransferofresponsibilityforthegoodswilltakeplace?HowtoUseanIncotermsRule?Makingreferencetoitinyoursalescontract.E.g.FCAUSD2300industrialParkway,Milwaukee,WI53223,USA,Incoterms2020.Payattentiontothespecialmeaningofsomewords:“carrier”referstothepartywithwhomcarriageiscontractedandwhoundertakestheobligationoftransportation;“delivery”indicatesthepointwheretheriskoflossordamagetothegoodspassesfromtheexportertotheimporter;and“customsformalities”arerequirementstobemetinordertocomplywithanyapplicablecustomsregulationsandmayincludedocumentary,security,informationorphysicalinspectionobligations.5.1.311Incoterms2020RulesinTwoClassesTwoClassesof11Incoterms2020rulesforanymodeormodesoftransportforseaandinlandwaterwaytransportEXWEXWORKS工厂交货FASFREEALONGSIDESHIP船边交货FCAFREECARRIER货交承运人FOBFREEONBOARD船上交货CPTCARRIAGEPAIDTO运费付至CFRCOSTANDFREIGHT成本加运费CIPCARRIAGEANDINSURANCEPAIDTO运费及保险费付至CIFCOST,INSURANCEANDFREIGHT成本、保险费加运费DAPDELIVEREDATPLACE所在地交货

DPUDELIVEREDATPLACEUNLOADED卸货地交货

DDPDELIVEREDDUTYPAID完税后交货

EscalatingResponsibilitiesandRisksforExportersForanymodeormodesoftransportForseaandinlandwaterwaytransportChangesofIncoterms2020overIncoterms2010TheIncotermsFCA(FreeCarrier)nowprovidestheadditionaloptiontomakeanon-boardnotationontheBillofLadingpriortoloadingofthegoodsonavessel.ThecostsnowappearcentralizedinA9/B9ofeachIncotermsrule.CIPnowrequiresatleastaninsurancewiththeminimumcoveroftheInstituteCargoClause(A)(Allrisk,subjecttoitemizedexclusions).CIFnowrequiresatleastaninsurancewiththeminimumcoveroftheInstituteCargoClause(C)(Numberoflistedrisks,subjecttoitemizedexclusions)ChangesofIncoterms2020overIncoterms2010TheruleDeliveredatTerminal(DAT)hasbeenchangedtoDeliveredatPlaceUnloaded(DPU)toclarifythattheplaceofdestinationcouldbeanyplaceandnotonlya“terminal”.TheIncotermsrulesofFreeCarrier(FCA),DeliveredatPlace(DAP),DeliveredatPlaceUnloaded(DPU)andDeliveredDutyPaid(DDP)nowtakeintoaccountthatthegoodsmaybecarriedwithoutanythird-partycarrierbeingengaged,namelybyusingitsownmeansoftransportation.TheIncoterms2020nowexplicitlyshiftstheresponsibilityofsecurity-relatedrequirementsandancillarycoststotheseller.5.2Incoterms2020Rulesin4groupsIncoterms2020Rulesin4groupsThe“E”Group:EXWThe"F"Group:FCA,FAS,FOBThe"C"Group:CPT,CIP,CFR,CIFThe"D"Group:DAP,DPU,DDP5.3HowtoUseIncoterms2020?5.3.1MakeReferenceofIncoterms2020Rules

inYourSalesContractForexample,CIFUSD1850,Shanghai,Incoterms®2020DPUUSD2350,611FifthAvenue,NewYork,NY,10022,US,Incoterms®20205.3.2SelecttheAppropriateIncotermsRuleselectonethatsuitsthegoodsselectonethatsuitsthemodeoftransportselectonethatsuitsthemethodofpaymentavoidtheextremeIncotermsrules5.3.3SpecifyYourPlaceorPortasPreciselyasPossibleForexample,FCAEURO1650,38CoursAlbert1er,Paris,FranceIncoterms20205.3.4ConvertingbetweenIncotermsRules

ConversionCFR=FOB+seafreightCPT=FCA+maincarriagefreightCIF=CFR+insurancepremiumCPI=CPT+insurancepremiumInsurancetheinsurancepremium—themoneyyoupaytotheunderwritertobuytheinsurance,whichisoftenapercentageoftheinsuredamount.Theinsuredamount—yourdeclaredvalueofthegoodsandthemostyoucanrecoverfromtheunderwriterwhenrisksmaterialize,which,accordingtoIncoterms2020andUCP600,shouldbeatleast110%oftheCIForCIPvalueofthemerchandise.Formulasforcalculatinginsuredamountandinsurancepremiuminsuredamount=CIForCIPvalue×(1+markuprate)insurancepremium=insuredamount×premiumrateCalculatingInsurancePremiumunderFOB,CFRorCPTSometimes,youarequotingnotinCIForCIPprice,butFOB,CFRorCPTprice,buttheimporterauthorizesyoutopurchaseinsuranceonbehalfofhim/her,thenyouneedtoconvertfromanFOBorCFRpricetoaCIFpriceorfromaCPTpricetoaCIPpricebeforeyoucancalculatetheinsurancepremiumandtheinsuredamount.CalculatingInsurancePremiumunderFOB,CFRorCPTTaketheCFRpriceasanexample,theinsurancepremiumwouldbecalculatedasfollows:insurancepremium=insuredamount×premiumrate=CIF×(1+markuprate)×premiumrateWhichequalsto,insurancepremium=(CFR+insurancepremium)×(1+markuprate)×premiumrateTheinsurancepremiumisthesingleunknowintheequationandcanbesolvedfor.CalculatingInsurancePremiumunderFOB,CFRorCPTTaketheFOBpricesasanexample,theinsurancepremiumwouldbecalculatedasfollows:insurancepremium=insuredamount×premiumrate=CIF×(1+markuprate)×premiumrateWhichequalsto,insurancepremium=(FOB+seafreight+insurancepremium)×(1+markuprate)×premiumrateTheinsurancepremiumisthesingleunknowintheequationandcanbesolvedfor.C