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Incoterms CPT: Spotlight on Carriage Paid To
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 Incoterms are the official International Chamber of Commerce (ICC) rules for the explanation of trade terms. Incoterms are adhered to by all major trading nations of the world, and it is the authoritative text for determining how costs and risks are allocated to the parties conducting international transactions. They facilitate the conduct of international business by defining the responsibilities of the involved participants.


This is the fourth article in our series investigating the basic meaning of all 11 Incoterms. (Read about the first three Incoterms here: FCA, DAP, and DDP.) The Incoterm we’re discussing today is Carriage Paid To, also known as CPT.

What Does the Carriage Paid To (CPT) Trade Term Mean?

CPT means “the seller delivers the goods to the carrier or another person nominated by the seller at an agreed place (if any such place is agreed between parties) and that the seller must contract for and pay the costs of carriage necessary to bring the goods to the named place of destination.”

When Can CPT Be Used?

CPT can be used for any transport mode—air, courier, truck, rail, vessel or multi-modal.

Benefits and Considerations of CPT

Unlike other terms, CPT divides the responsibilities for transportation and risk for goods between two points.

If subsequent carriers are used for the carriage to the agreed destination, the risk passes when the goods have been delivered to the first carrier. (Source)

Pay attention to “Terminal Handling Charges” (THC) when using this trade term. THC are made by the terminal operator, and they may or may not be included by the carrier in their freight rates. Buyers should enquire whether the CPT price includes THC so as to avoid surprises. (Source)

 
( Milissa )31 Mar,2017

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