The Incoterms are set to change in their once-a-decade revamp in 2020. The new terms are currently being drafted by the International Chamber of Commerce (ICC), which publishes the conditions.
The Committee of Experts drafting the document is comprised of lawyers, traders and company representatives from around the world, including France, the UK, Germany, Turkey and the US, and will be joined for the first time by representatives from China and Australia, according to a report by the Global Negotiator.
The ICC is making a major effort to streamline and simplify Incoterms and make them easier to understand. Many terms have led to misunderstandings and disputes that the committee will aim to make easier to comprehend.
The ICC’s rule reform does not apply to VAT, Customs and VGM (verified gross mass) as these regulations vary from country-to-country, region or product and, as such, are not universally applicable. The aim is to standardise trading rules to benefit the global trading and shipping community.
The updated Incoterms are expected to be released in the final quarter of 2019 and go into effect on 1 January 2020, according to the report.
As new importers and exporters from the e-commerce sector engage with freight forwarders and carriers for the first time, they need a simple and easy-to-use guide to Incoterms. This is high on the agenda of the Committee of Experts, and with China joining the ICC team drafting the 2020 version, its delegates can provide invaluable input from the world’s largest e-commerce sector.
Incoterms were first developed in 1936 by the International Chamber of Commerce (ICC) in an attempt to simplify communication shortfalls involved with international trade. It was through the publication of the first ever International Rules for the Interpretation of Trade Terms that we now have “Incoterms”.