Incoterms - DAF

Incoterms - DAF
DAF (Delivered At Frontier) is a monomial (land) expression which should be further qualified by naming the frontier (border post) up to which the seller is prepared to take responsibility for transport costs and the corresponding risks of transit.

The frontier is deemed to be on the seller's side of the applicable border unless the term is modified to express that the point of transfer is the frontier on the buyer's side of the border.

The seller must clear the cargo through customs before handover on the export side of the border, whereas the buyer must clear the cargo through customs on the import side.

DAF can vary from other D terms in that the seller may not be responsible for all or even partial of the main carriage because the Frontier falls on the seller's side of the border. For example, the seller may pass risk and responsibility at the first of these, obligating the buyer to arrange the main carriage thereafter if the transit involved the movement of cargo through several frontiers

As a land term the application of DAF is for land-based operations and other D terms such as DDU or DDP should be considered if the transaction is not land-based. (I.e. it is not exclusively road or rail or a road/rail combination).

Incoterms - CPT/CIP

Incoterms - CPT/CIP

CPT (Carriage Paid To) is the multimodal equivalent of CFR. The named place where the costs end by seller can be a point other than a seaport (as well as being a seaport) in the buyer's country.

CPT may be used for airfreight, road freight and rail freight as well as for sea freight when the ship's rail serves no purpose. E.g. if the destination is an inland point or a modern port with conditions as discussed under FOB.

CPT requires the use of multimodal documents and documents such as Bills of Lading or Airway bills may prove inappropriate in recording the passage of risks under this term.

Under CPT, seller passes the risk and responsibility to the buyer when the cargo is handed to the first carrier (with a carrier defined as either an Actual or Contractual carrier i.e. a Freight Forwarder or Multi Transport Operator could act as 'carrier' as could an airline or shipping line).
However, responsibility for costs only transfer when the goods arrive at the stated place where carriage is 'paid to'.

Buyers expressed the cautions on using CFR are equally applicable to CPT with additional complications in the transfer of risks can begin earlier. If the carrier is collecting the cargo from the seller's premises then the risks of carriage pass to the buyer at that point, whereas the buyer's ability to control the costs and schedule of carriage only pass at the destination point.

Although these reservations warrant serious consideration for a buyer, they represent great risk-management opportunities for the seller.

CIP (Carriage & Insurance Paid to) represents CPT with the addition of Insurance. The cautions and notes made regarding CPT equally applicable to CIP.

Incoterms CFR/CIF

CFR (CNF/C&F) (Cost and Freight) has a long history in the INCOTERMS.

As an INCOTERM, seller passes the risk to the buyer when the cargo crosses the ship's rail at the port of origin. However, the seller passes the responsibilities for the costs of transit to the buyer at the port of destination only. Both of CFR and CIF are Monomial expressions used when the main carriage is by sea as well as suited to the use of Bills of Lading.

Because the ship's rail is seen as triggering these terms, it is often inappropriate to use either in a modern port and reference should be made to the notes on this subject under FOB.

Buyers are disadvantaged which must take risks for a period of carriage during that the buyer has no means of controlling or limiting those risks. Seller controls all the carrier used, the costs incurred for carriage and the schedule of the carriage. The buyer must consider this disparity before accepting these contracts. From the seller's perspective, these terms represent exceptional risk-management opportunities and are actively pursued as a consequence.

CIF (Cost, Insurance and Freight) represents the condition of CFR with the addition of Insurance. This is the first of only two terms that place a compulsory responsibility for insurance on the seller. Under all other terms, the buyer considers insurance as an optional responsibility. (Refer CIP)

SUBMISSION OF EXP AND EXPORT DOCS BANK TO BANK

01. APPLICATION FOR SUBMISSION OF EXP.

02. EXP FORM. (BUT NEED KEEP OFFICE COPY OF CUSTOMS SIGN PAGE).

03. APPLICATION FOR SUBMISSION OF EXPORT DOCS

04. invoice (04 copy)

05. Packing List (04 copy)

06. Bill of Exchange (03 set)

07. BL (copy of original BL and (non nego copy)

08. Original GSP and Copy.

09. IC and copy.

#need to separate two set docs. one for local bank and another for buyer bank.