International commercial terms - Incoterms for short - explain the rules and conditions that buyers and sellers use in international and domestic trade contracts.
The International Chamber of Commerce (ICC) developed Incoterms in 1936 and updates them periodically to keep them in line with changing trade practices.
Typical examples of Incoterms rules for any mode of transport include delivery to terminal (DAT), delivery duty paid (DDP) and delivery ex-works (EXW).
Incoterms have been updated for 2020 and although only one term has changed, there are notable differences in the cost of security.
Terms are standardized, but some buyers and sellers will prefer individual terms over others. So which terms will be used is a matter of negotiation.