Incoterms 2020 — EXW, FOB, CIF, DDP ต่างกันยังไงIncoterms 2020 — EXW, FOB, CIF and DDP explained

Incoterms are the delivery terms published by the International Chamber of Commerce. The current edition is Incoterms 2020. Their job is to settle two questions in the sales contract.

• Who pays for what: freight, insurance, clearance, duty
• Where risk transfers: if goods are damaged or lost at a given point, who carries it

These two are separate, and that separation is behind nearly every misunderstanding. A seller may be paying the freight while risk has already passed to the buyer back at the origin port.

The four you will meet most

EXW — Ex Works. The seller simply makes the goods available at their premises. Everything after that is yours. The headline price looks lowest, but you carry it from the factory gate onward. Only sensible if you already have an agent at origin.

FOB — Free On Board. The seller loads the goods on board at the origin port and risk passes to you once they are on the vessel. This is the most common term for Thai importers: the split is clear and you can shop for your own freight rate.

CIF — Cost, Insurance and Freight. The seller pays freight and insurance to the destination port, but risk still passes to you when the goods are loaded at origin, exactly as under FOB. This is the single most misread point: paying for insurance does not mean the seller keeps the risk.

DDP — Delivered Duty Paid. The seller carries everything to the destination, including import duty and taxes. It places the most obligation on the seller.

The DDP catch worth knowing

DDP is convenient for buyers because the landed cost is fixed up front. But one point must be agreed before you sign.

• Who is the importer of record. If it is not your company, the declaration and tax receipts will not be in your name, which means you cannot book the cost or reclaim input VAT.
• If you need the paperwork in your own company's name, say so at the quoting stage, not after arrival.
• This is not a technicality. It goes straight to your tax position.

Choosing for your situation

New, with no agent at origin: start with FOB or DDP, not EXW. Need full documents for accounting and VAT recovery: choose an arrangement where you are the importer. Value simplicity over paperwork: DDP will serve you better.