Today’s subject is going to be Incoterms 2020. Exciting stuff, right? For those of you not familiar with Incoterms; and if you are involved in international trade you should know and be comfortable with them. They are international commercial trade terms that help the world facilitate trillions of dollars in global trade a year. Basically, the various terms define sellers and buyers’ responsibilities in a transaction. They simplify trade by avoiding problems and by helping the parties understand their responsibilities prior to the shipment, when used correctly.
The Incoterms are updated every ten years. The current terms are Incoterms 2010. The commercial terms are published in a book format and Incoterms 2020 should become available over the next few months and will be good for the next ten years.
50 years ago, Neil Armstrong stepped onto the moon. Exciting stuff, right? Currently, there are several commercial and government ventures that are planning to go to the moon, mars, and beyond for further exploration. Regardless of the destination cargo will have to move there. As the world is preparing to begin moving cargo into space, clarity and the correct understanding of responsibilities is paramount.
To stay current, the discussions are already beginning at Incoterms. As the world begins to go into these new frontiers, how can trade manage these new responsibilities as we move into space over the next decades? To further complicate things, there are a number of international treaties that govern space. Incoterms and the commercial world are already considering how to redefine responsibilities. It is fascinating to consider that in the future we will be moving goods not only east and west by airplanes and ships, but by rocket. Imagine when you set up your invoice with an Incoterm of DAP Sea of Tranquility as the destination.
Blog posting by Scott Hoffman, President of Jade International
