Incoterms Update: Incoterms 2010 Likely to Take Effect in January 2011
Frank Reynolds, the U.S. Delegate to the International Chamber of Commerce's (ICC) Incoterms committee, has provided International Trade Law News with an update on the status of the revisions currently underway to Incoterms 2000, the standardized trade terms commonly used in international sales contracts.
After receiving a large number of comments from the ICC National Committees, the Incoterms Drafting Group recently completed a third draft of the revised version of Incoterms. After comments on the third draft are submitted by the ICC National Committees, the Drafting Group will meet in March 2010 to prepare a fourth version of the draft revisions to Incoterms.
At this time, it remains the ICC’s goal to release the final version of Incoterms in the fall of 2010 with an effective date of January 1, 2011 (this date is subject to change).
In a change from previous reports, it appears that the new version of Incoterms will be entitled “Incoterms 2010”, reflecting the release date rather than the date they come into force (this is the third name change during this revision). In addition to the information provided in previous updates, Mr. Reynolds has provided the following information on items that may be contained in the final version of Incoterms 2010:
- There will be clear differentiation between the omnimodal terms and those intended only for marine use.
- Cargo security will be covered to the extent possible with differing regulatory systems.
- The preambles to each Incoterm will be expanded to better inform users of its intended use.
- A new term will be included to facilitate use in domestic transactions and those within Customs Unions where no export or import clearance obligations exist (as previously noted there are likely to be fewer than the 13 Incoterms in Incoterms 2000).
In order to prepare for 2011 implementation of the revised Incoterms, the United States Council for International Business will be conducting training programs starting in the fall of 2010.
The ICC introduced the first version of Incoterms, short for "International Commercial Terms," in 1936. There are currently 13 Incoterms. Incoterms have been revised six times in order to reflect international trade developments.
Frank Reynolds is the author of Incoterms for Americans, a useful publication for U.S. exporters and importers, which will be revised following the publication of Incoterms 2010.