Logistics Terms and Process Gates
Working TSG summaries for DDP, DDU, FOB, CIF, and EXW. Shipment automation can evaluate evidence, but release still requires broker, compliance, finance, and operator controls when gates apply.
DDU is legacy language.
TSG does not treat DDU as a current default rule. Replace it with DAP where possible, or require versioned contract language, broker review, legal review, and counterparty acknowledgement before shipment authorization.
DDP
Delivered Duty Paid
Seller carries the heaviest obligation: transport to destination, import clearance, duties, taxes, and delivery ready for unloading.
Risk Transfer
Risk transfers when goods are made available to the buyer at the named destination, ready for unloading.
TSG Posture
Use only when TSG or the seller has importer-of-record capability, broker approval, tax/duty reserve, and destination compliance review.
DDU
Delivered Duty Unpaid
Seller delivers to destination but buyer handles import clearance, duties, and taxes. TSG treats this as legacy language requiring review.
Risk Transfer
Typically at named destination under the legacy clause, but the contract must state the exact point.
TSG Posture
Review and convert to DAP for Incoterms 2020 work, or require legal approval for an older-version contract reference.
FOB
Free On Board
Seller export-clears and loads goods on board the buyer-nominated vessel; buyer controls ocean freight, insurance, destination, and import.
Risk Transfer
Risk transfers when goods are loaded on board the vessel at the named port of shipment.
TSG Posture
Good for ocean-control lanes when TSG wants buyer-side freight leverage. For container or multimodal pickup before vessel loading, review FCA instead.
CIF
Cost, Insurance and Freight
Seller pays cost, insurance, and freight to the destination port, but risk still transfers when goods are loaded on board at origin.
Risk Transfer
Risk transfers when goods are loaded on board the vessel at the port of shipment, even though seller pays freight and insurance.
TSG Posture
Use for ocean lanes when seller has better carrier access, but always verify insurance, destination charge split, and import owner.
EXW
Ex Works
Seller makes goods available at its premises or named place; buyer carries most cost, export, transport, import, and operational burden.
Risk Transfer
Risk transfers when goods are placed at the buyer's disposal at the named place before loading, unless varied by contract.
TSG Posture
Avoid as a default for China export or regulated products unless buyer/exporter roles, pickup authority, and export clearance are already controlled.
Required Process Evidence
DDP
Any ModeNamed place of destination, with Incoterms 2020 version stated.
DDU
Any ModeLegacy named destination term. Do not use as a default Incoterms 2020 term; replace with DAP or cite the older version explicitly.
FOB
Sea Or Inland WaterwayNamed port of loading, with Incoterms 2020 version stated.
CIF
Sea Or Inland WaterwayNamed port of destination, with Incoterms 2020 version stated.
EXW
Any ModeNamed seller premises or pickup place, with Incoterms 2020 version stated.