Incoterms (International Commercial Terms) are published by the International Chamber of Commerce (ICC). They define where the buyer’s and seller’s responsibilities begin and end for delivery, transfer of risk, and allocation of costs. Our Incoterms explained guide walks through how to choose the right term for a shipment from China, while this page zooms in on what changed between the two editions. The current version is Incoterms 2020, effective 1 January 2020, replacing Incoterms 2010.
Set expectations first: compared with 2010, Incoterms 2020 changed surprisingly little. Most updates are about how the rules are organized and worded. Only two changes really matter — DAT was renamed to DPU, and CIP’s insurance requirement was upgraded. The rest are clarifications. This guide breaks down the differences between Incoterms 2010 and 2020 — what’s new in the 2020 update, term by term — and ends with a recommendation on which version to use.
Both versions contain 11 terms, split into “any mode of transport (7: EXW, FCA, CPT, CIP, DAP, DPU, DDP)” and “sea and inland waterway only (4: FAS, FOB, CFR, CIF)” — our full Incoterms chart lays all 11 out side by side.
What changed: 2010 vs 2020 at a glance
| Change | Incoterms 2010 | Incoterms 2020 | What it means for you |
|---|---|---|---|
| DAT → DPU | DAT (Delivered at Terminal) | DPU (Delivered at Place Unloaded) | Delivery is no longer limited to a “terminal”; it can be any place, and the seller unloads |
| CIP insurance level | Minimum cover ICC(C) | All-risks ICC(A) | The seller’s insurance duty under CIP increases; CIF is unchanged, still ICC(C) |
| FCA on-board B/L | No clear mechanism | Carrier can issue an “on-board” bill of lading | Easier for letter-of-credit (L/C) settlement |
| Own means of transport | Third-party carrier assumed | Explicitly allows the buyer’s or seller’s own transport | Clearer responsibility for self-delivery / self-collection |
| Security requirements & costs | Scattered allocation | Each term spells out security-related duties and costs | Clearer ownership of security-related costs |
| Article layout | — | A1–A10 reordered, costs listed together (A9/B9) | Easier to read; no change to actual obligations |
DAT renamed to DPU: the change to remember
The DAT (Delivered at Terminal) of 2010 became DPU (Delivered at Place Unloaded) in 2020.
What changed is more than the name:
- The delivery point is no longer limited to a “terminal” (port, airport, container yard, etc.); it can be any agreed place.
- DPU is the only Incoterm that requires the seller to unload at the destination — both the unloading duty and the risk sit with the seller.
If you deliver “to the door,” DPU is easy to confuse with the duty-paid DDP, and the line between DAP and DDP comes down to who clears customs and pays the duty.
Insurance level: CIP rises to ICC(A), CIF stays ICC(C)
This is the second key 2020 change, and it affects only CIP, not CIF:
- CIP: the seller’s minimum insurance rises from 2010’s ICC(C) (basic cover) to ICC(A) (all risks).
- CIF: unchanged — the seller still only needs ICC(C) minimum cover.
So under 2020, CIP and CIF now sit at different insurance levels. When quoting and contracting, state clearly which term applies and which level of cover it carries, or you risk pricing on the old basis. On a straight sea-freight booking, the more common call is CIF versus FOB — there the question is who arranges and pays for the cover at all.
A quick estimate (orders of magnitude only — confirm actual rates with your insurer): for one general-cargo shipment with a CIF value of US$50,000, the insured amount follows the standard CIF/CIP minimum of contract value × 110% = US$55,000; applying an illustrative market rate of about 0.3‰ (real rates vary by cargo, route, and insurer), the premium ≈ 55,000 × 0.0003 ≈ US$16.5 (about ¥120).
In other words, the premium for all-risks cover is usually small — the real point isn’t cost but that the insurance duty clearly falls on the seller, and that CIP and CIF now carry different cover.
FCA’s new option: you can ask for an “on-board” bill of lading
Under 2010, using FCA while needing an on-board bill of lading for letter-of-credit settlement often caused friction.
2020 adds a mechanism: the parties can agree that the buyer instructs the carrier to issue an on-board bill of lading to the seller after the goods are loaded. This makes FCA fit letter-of-credit (L/C) settlement much better, especially for containerized cargo.
Many shippers hesitate between FCA and FOB, whose delivery point and risk transfer differ, when deciding which to book.
Own means of transport is now formally recognized
2010 assumed transport would be carried out by a third-party carrier. 2020 makes it explicit: under FCA, DAP, DPU, and DDP, the buyer or seller may use their own means of transport instead of hiring a third party.
This is friendlier to companies that run their own fleet.
Security requirements and cost allocation are spelled out more clearly
2020 allocates transport-security-related requirements and their costs more explicitly within each term (e.g., screening and declarations), and reorders clauses A1–A10, listing each term’s costs together (A9/B9).
This does not change who bears which obligation — it just makes the rules easier to read and look up. It’s a usability improvement, not a substantive change.
When the buyer and seller name different versions
A subtle but real risk: if one side’s paperwork says CIP Incoterms 2010 and the other’s says CIP Incoterms 2020, you are not only citing different years — you are agreeing to different insurance levels (ICC(C) vs ICC(A)). The same gap hides in renewals when one party reuses an old template. Before shipping, confirm both sides cite the same version in writing; otherwise each party assumes its own cover level is the one that applies.
Field example — Toronto DDP. A B2B importer shipped a 40HQ of furniture from Shenzhen to Greater Toronto under DDP. The trap on Canadian door delivery is the destination costs buyers don’t see upfront — GST, CARM registration timing, and live-unload / waiting / yard charges. On our ocean freight lanes we pinned every line down in an itemized FOB-to-DDP quote (freight, destination DO, trucking, clearance, CARM, duty), so there were zero surprise charges on arrival and the client signed a multi-shipment deal.
Can I still use Incoterms 2010?
Yes. Incoterms 2010 did not expire when 2020 took effect. As long as your contract clearly states the version year (e.g., “FOB Shanghai Incoterms 2010”), the older version remains valid and binding — a point the U.S. International Trade Administration also confirms.
Which version should you use?
For most new contracts, go with Incoterms 2020: it’s the current version, the clauses are clearer, and it covers arrangements that fit today’s practice (DPU, all-risks CIP, and so on). Whether you must switch depends on your situation:
| Your situation | Recommendation | Why |
|---|---|---|
| Settling by letter of credit (L/C) | Lean 2020 | FCA can require an “on-board” B/L, which fits L/C |
| High-value goods / care about cover level | Note 2020 | CIP is now ICC(A) all-risks; greater seller duty |
| Need the seller to unload | Use DPU (formerly DAT) | 2020 renamed it and made the unloading duty explicit |
| Delivering “to the door / duty paid” (e-commerce, FBA, etc.) | Spell out DPU/DDP duties | Put unloading, clearance, and tax duties in the contract |
| Changes don’t affect you / keeping old habits | 2010 is still valid | But the contract must state “Incoterms 2010” |
Practical checklist before signing a quote or PO
Before you sign a quote or purchase order, run this quick Incoterms 2020 checklist. It’s where the differences between Incoterms 2010 and 2020 turn into real money — version mismatches, insurance gaps, and unclear destination costs:
- [ ] Version year stated? Does the quote or PO name the edition — e.g. “CIP Shanghai Incoterms 2020” — and not just “CIP Shanghai”?
- [ ] Named place matches the term? Is the named place right for the rule (port of destination for CIF, the buyer’s address for DAP/DPU/DDP)?
- [ ] CIP/CIF insurance clause stated? For CIP, does it specify ICC(A) all-risks cover; for CIF, ICC(C) minimum — and who arranges the policy?
- [ ] FCA + L/C: on-board B/L required? If you settle by letter of credit under FCA, is the “on-board” bill of lading requirement written in?
- [ ] DPU/DDP cost split clear? Who pays unloading, import duty, taxes, and demurrage / waiting time at destination?
- [ ] Same version across all documents? Do the PI, PO, booking, commercial invoice, and contract all cite the same Incoterms version?
Bottom line
For most new contracts, use Incoterms 2020 — but 2010 remains fully valid when that’s the edition your contract names.
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FAQ
Is DPU the same as DDP?
No. Both can deliver to the destination, but under DPU the seller unloads while the buyer handles import clearance and duties; under DDP the seller also clears customs and pays import duties.
Are there Incoterms 2023 or 2024?
No. The ICC doesn’t update Incoterms every year — it revises them roughly once a decade. Incoterms 2020 (effective 1 January 2020) is the current edition; there is no 2021, 2022, 2023, or 2024 version, and the next revision isn’t expected until around 2030. If a quote or article mentions “Incoterms 2023,” read it as “the rules in force in 2023” — that’s still Incoterms 2020.
My PO says “freight prepaid” or “freight collect” — are those Incoterms 2020 terms?
No. Those phrases only say who pays the freight bill; they aren’t Incoterms rules and appear in neither the 2010 nor the 2020 edition. Translate the intent into a proper term: if the seller arranges and pays the main carriage, use CFR/CIF (sea) or CPT/CIP (any mode); if the buyer does, use FOB/FCA. Whichever you pick, pair it with a named place and the version year — e.g. “FCA Shanghai Incoterms 2020.”
