ICC holds seminar on INCOTERMS
A two-day advanced International Commercial Terms (Incoterms 2010) seminar has been held for practitioners in the trade finance sector to help build capacities in order to secure a successful sales transactions.
The seminar spearheaded by the International Chamber of Commerce- Ghana was among other objectives to illustrate the impact of the chosen Incoterms 2010 rule on the different aspects of the contract of sale with learning by doing seminar.
It also offered participants to make input into the Incoterms 2020 rules. It was targeted at building the capacities of contract negotiators and traders, execution operatives in export companies and houses; logistics operatives with transport or shipping companies or with freight forwarders.
It was also targeted at trade finance officers in banks; export/import consultants and advisors; professionals working in finance and risk departments; in-house cargo insurance specialists with insurance companies and lawyers. Participants were drawn from senior managers from the Ports, bankers and financial institutions, freight forwarders,
Affirming the importance of the training during a presentation, Mr. Edward Ribeiro, Head, Group Trade Finance “Ecobank said the seminar gave participants real life scenarios to practice, choosing the most efficient Incoterms rule to include in the contract of sale and applying it correctly.
So by agreeing on an Incoterms rule and incorporating it into the sales contract, the buyer and seller can achieve a precise understanding of what each party is obliged to do, and where responsibility lies in event of loss, damage or other mishap," he said.
Mr. Ribeiro explained that when considering the use of Incoterms 2010 in a commodity sales contract, it is important to carefully consider which rule is most appropriate in terms of the cost and risk allocation agreed between the parties, the method of transport and loading arrangements.
He added that the use of any Incoterms 2010 in a sales contract must be consistent with the remainder of the sales contract in terms of cost and risk allocation, insurance obligations, liability for duties and loading or unloading arrangements, and should also be consistent with any harbour regulations. The choice of rule should also be consistent with transportation or carriage contracts.
B&FT has gathered that there are 11 trade terms specified in Incoterms 2010 which are divided into two categories “ rules for any mode of transport1 including where there is no waterway transport at all, and rules for sea and inland waterway transport.
These rules allocate certain costs and risks between the buyer and seller, and delineate responsibilities for practical matters such as customs formalities and duties, loading and unloading, and insurance.
Incoterms, which were first introduced by the International Chamber of Commerce in 1936, were developed to address problems arising out of the inconsistent interpretation of trade terms amongst international trading partners and thereby reduce the number of disputes.
These rules have evolved over time to adapt to the changing nature of international and domestic trade including in relation to security, multi-modal transportation and electronic communications.
Mr. Emmanuel Doni-Kwame, Secretary-General of ICC Ghana urged participants to use the incoterms 2010 rules book to boost their confidence in order to identify the most suitable incoterms rule.
He explained that the Incoterms 2010 rules are standard sets of trading terms and conditions designed to assist traders when goods are sold and transported.
The Incoterms rules are created and published by the International Chamber of Commerce (ICC) and are revised from time to time. The most recent revision is Incoterms 2010 which came into force on 1st January 2011.