As a good practice, all solicitations for goods should clearly state the requested and the preferred INCOTERM(s). The determination of the appropriate INCOTERM to use shall be made by the Procurement Staff on a case-by-case basis and should only be made with a full understanding of its meaning.

INCOTERMS or International Commercial Terms are a series of international sales terms, published by International Chamber of Commerce (ICC) and widely used in international commercial transactions. INCOTERMS 2000 is the latest version of INCOTERMS entered into force on 1 January 2000 (INCOTERMS 2000).

Purpose of INCOTERMS
INCOTERMS are used to divide transaction costs and responsibilities between buyer and seller and reflect state-of-the-art transportation practices. By using these terms, the parties to the transaction avoid or at least reduce to a considerable degree the uncertainties of different interpretations of such terms.

Identification and Allocation of Responsibilities under INCOTERMS
The chosen INCOTERM determines when the risk of loss of goods passes to the buyer; how various costs for shipment and other costs will be divided between the parties; and what the seller and buyer must do with respect to delivery and shipment of the goods from seller to buyer, including who is responsible for export and import clearance.

INCOTERMS do not deal with transfer of ownership, force majeure, or the consequences of various breaches of contract. Those issues are normally dealt with in the contract or the UNGCC.

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