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and insurance cost. 18 The “C” terms ( CFR, CIF, CPT, CIP) ?Two ―critical‖ points ?Port (place) of shipment – to which the buyer takes over the risks ?Port (place) of destination – to which the seller is bound to arrange and bear the costs of a contract of carriage 19 CFR Cost and Freight (… named port of destination) ? Shares every feature with FOB except for ocean freight charge ? Freight at seller’s cost ? Seller pay the normal transport cost for the carriage of the vessel by a usual route and in a customary manner to the agreed place ? Buyer take the risk of loss or damage to the goods and additional costs resulting from events occurring after the delivery of the goods ? Obligation: seller’s responsibility ?for booking shipping space and getting goods ready for shipment in due time ? to notify to buyer about the delivery of goods (Shipping advice) so as to facilitate buyer to fulfill insurance procedures Note: notification is more important under CFR than under FOB and CIF 20 CIF Cost, Insurance and Freight (… named port of destination) ?One step forward from CFR ?Insurance born by seller ?Insurance for the buyer ?The seller pays for the insurance, but he does not take the risk of the cargo. ?Seller responsible for ―min. coverage‖ ?If required by buyer and at buyer’s expense, additional coverage such as war, strike can be added ?Seller has no responsibility to guarantee the arrival of the goods at the destination. 21 CPT Carriage Paid to (… named place of destination) ? CPT is similar to CFR ? Differences: ?Mode of transport ?CPT – any mode ?CFR – Sea or Inland Waterway ? Delivery point ? CPT – inland place or port of shipment ? CFR – port of shipment ? Transfer of risks ? CPT – goods delivered to carrier ? CFR – goods loaded on board the ship 22 CIP Carriage and Insurance Paid to (… named place of destination) ? CIP is similar to CIF ? Differences: ?Mode of transport ?CIP – any mode ?CIF – sea or inland waterway ? Delivery point ? CIP – inland place or port of shipment ? CIF – port of shipment ? Transfer of risks ? CIP – goods at the disposal of carrier ? CIF – goods loaded on board the ship ?Freight and insurance ?CIP – whole journey freight and insurance ?CIF – ocean freight and insurance 23 The “D” terms ( DAT, DAP, DDP) ?Arrival contracts – seller bear all risks and costs in bringing the goods to the agreed place or point of destination at the border or within the country of import. ?Seller’s responsibility max. ?Seller responsible for both export and import customs clearance under DDP 24 DAT Delivered at Terminal (… named terminal at port or place of destination) ?Terminal: the end of a railway line, bus line, or the centre used by cargo departing for or arriving from. ?Delivery point: at the nominated terminal ?Transfer of risks: at the nominated terminal ?Note: The goods are unloaded from the transporting vehicle. 25 DAP Delivered at Place(… named place of destination) ? DAP similar to CPT ? Differences: ? Place of delivery ? DAP – port of destination, CPT – the first carrier ? Transfer of risks ? DAP – the seller bears all risks involved in bringing the goods to the named destination. ? CPT – goods pass over to the first carrier 26 ?DDP – seller’s obligation max.: seller provides a ―doortodoor‖ delivery and bears the entire ris