Why do I need to know about shipping terms (‘Incoterms’)?
- On 23rd September 2019
Because these shipping terms which should appear on the sales invoice your supplier has raised, will determine if any sea freight and/or marine insurance is to be added to the value of your product before import duty is calculated. For example Incoterms FOB (Free of Board) means all charges have been paid up to loading onto the vessel in the foreign port (let’s assume Ningbo). So we must add the freight from Ningbo to UK, plus any arranged marine insurance before calculating duty.
CIF UK port (Cost Insurance Freight) means that everything is paid up to the port of entry in the UK.
See link below for more information:
Or just type SHIPPING INCOTERMS into your search engine to learn more. The terms are usually written in 3 alpha form, i.e. FOB, CIF, DDP etc.