Incoterms 2020 organizes its 11 rules into two categories based on the mode of transport:
Rules for any mode of transport (multimodal) — usable for air, road, rail, ocean, or multimodal shipments:
- EXW — Ex Works
- FCA — Free Carrier
- CPT — Carriage Paid To
- CIP — Carriage and Insurance Paid To
- DAP — Delivered at Place
- DPU — Delivered at Place Unloaded
- DDP — Delivered Duty Paid
Rules for sea and inland waterway transport only — usable only when both delivery and risk transfer occur at a port, and cargo is loaded directly on a vessel:
- FAS — Free Alongside Ship
- FOB — Free on Board
- CFR — Cost and Freight
- CIF — Cost, Insurance and Freight
The two categories exist because the sea-only rules tie delivery and risk transfer to specific maritime concepts ("alongside ship," "on board the vessel") that don't translate to other modes.
Container cargo special case — Despite being shipped by sea, containerized cargo doesn't fit cleanly into the sea-only rules. Containers are typically delivered to terminals well before loading and stored in terminal yards. The ICC explicitly recommends that container shippers use the multimodal rules (FCA, CPT, CIP, DAP, DPU, DDP) rather than the sea-only rules, but commercial practice often defaults to FOB and CIF for historical reasons.
When choosing an Incoterm, start from the mode of transport and the practical delivery point — then evaluate cost, risk, insurance, and import-clearance obligations.