If you buy or sell goods to another country, choosing the wrong Incoterm can lead to unexpected costs and disputes over transport, insurance, or customs.
This guide helps you understand the rules in effect in 2026 and clearly compare responsibilities.
Incoterms define who assumes the costs, procedures, and risk of the goods at each stage of the transaction.
Below, you’ll find a comparison table of the 11 terms, their uses depending on the mode of transport, and the exact point at which the risk changes.
You’ll also learn how to choose the right rule, arrange the necessary insurance, and draft the commercial clause unambiguously.
Key points to consider before diving in:
You will compare the 11 terms and their main responsibilities.
You will identify when the risk is transferred.
You will choose and draft the appropriate rule for your transaction.
What are Incoterms and what are they used for?
Before comparing the 11 terms, let’s clarify what Incoterms actually address and what they are often mistakenly associated with.
Incoterms are rules from the International Chamber of Commerce (ICC) that define the tasks, costs, and risks for each party in an international sale. Choosing and applying them correctly can prevent many problems regarding the delivery of goods.
Roles in an international transaction
Incoterms determine who organizes and pays for specific parts of the transport. Depending on the term, they determine who is responsible for:
Preparing and packing the goods.
Delivering them to an agreed-upon location.
Arranging the main transport.
Handling export and import procedures.
Paying certain logistics costs.
Providing insurance if required by the term.
They also define when the risk transfers from the seller to the buyer. This moment does not always coincide with the arrival of the goods at their destination or with the transfer of ownership. For example, a term may obligate the seller to pay for transport to the destination, even though the risk passes to the buyer beforehand.
Important! You must write the term along with a specific place, such as CIP Madrid, Incoterms® 2020. The current version published by the ICC is Incoterms® 2020; there is no official “Incoterms® 2026” edition.
Scope of Application and Aspects Not Regulated
Incoterms only regulate certain elements of the delivery of goods between seller and buyer. They do not replace the sales contract, nor do they determine the price, payment method, currency, penalties for non-compliance, or applicable law.
They also do not, on their own, determine:
When ownership is transferred.
Quality or quantity specifications.
Product warranties.
Dispute resolution.
Applicable tariffs in each country.
Restrictions on specific products.
Check if the chosen term is suitable for the intended mode of transport. FAS, FOB, CFR, and CIF are reserved for maritime or inland waterway transport. For containerized cargo or combined transport, terms like FCA, CPT, or CIP are usually better.
Don’t forget! The insurance included in CIF or CIP has a specific scope and conditions; it doesn’t automatically cover all possible damages. New features and validity of the 2020 edition in 2026
It’s worth clarifying this before continuing: there is no “Incoterms 2026” version, and here’s why.
In 2026, the current edition of the Incoterms® rules remains the 2020 version from the International Chamber of Commerce (ICC). There is no official Incoterms® 2026 edition, although customs, tariff, and digital changes may affect how you apply these rules. Why there isn’t an Incoterms 2026 edition
The ICC doesn’t publish a new edition every year. It only revises the rules when it deems it necessary to update their content, so the 2020 version remains valid until another official edition is released.
The 11 current rules continue to define specific responsibilities regarding:
Delivery and transfer of risk
Transport and associated costs
Export and import clearance
Insurance, when required by the rule
Documents and security obligations
Changes in tariffs, customs controls, penalties, or digital systems do not, in themselves, modify the meaning of an Incoterm. If you have new requirements in a 2026 transaction, you must reflect them in the contract, purchase order, or logistics instructions.
Important! When choosing a rule, write the full reference: “CIF Port of Valencia, Incoterms® 2020”. Also, check if the chosen term corresponds to the mode of transport and if it correctly allocates the costs and risks of your transaction.
Contractual Use of Previous Versions
You can agree to a previous version if both parties clearly identify it. Incoterms® rules do not automatically replace a previous version already in a contract, accepted offer, or purchase order.
For example, a clause such as “FOB Shanghai, Incoterms® 2010” remains valid, except in certain cases.