Incoterms 2010, the long-awaited revision of the International Chamber of Commerce’s shipping and delivery rules, were formally released Sept. 17. An overall change of six rules brought the net total from 13 to 11. Other major changes include definitions, cargo security and emphasis on precise place identification and container loading. Even the venerable reference to the “ship’s rail” was dropped.
This version was specifically drafted to be user-friendly for domestic as well as international use. Three former rules were combined to form the new “Delivered at Place,” an improved version of the popular “Delivered Duty Paid.” The former marine-only “Delivered Ex Quay” was broadened for use in all transportation modes as the new “Delivered at Terminal.”
The result is there is now a very close Incoterms rule matchup for all commonly used former Uniform Commercial Code shipment and delivery terms.
Trade response is favorable and considerable. As of mid-November, more than 2,500 people had attended official ICC training provided by the United States Council for International Business, and the number of alternative training sources is growing.
There has been great interest in domestic use. The advantages of a common platform for shipping and delivery terms are obvious to industry-leading U.S. businesses. Their use is likely to produce the kind of ripple effect that happened when the Big Three automakers introduced EDI to their vendors years ago, kick-starting the popularity of e-commerce.
Widespread domestic use will take time because there is considerable back-office work involved with order entry systems, legacy contracts and other documents and processes. Look for it to really take off over the next two to three years, well within the expected lifetime of this Incoterms version.