Definitions for "Incoterm"
International Commercial Term Commercial term (generally expressed by an abbreviation such as FOB, etc.) defining the respective obligations and the sharing of responsabilities between a seller and a buyer in the context of international trade.
A codification of international rules for the uniform interpretation of common contract clauses in export/import transactions involving goods. Developed and issued by the International Chamber of Commerce (ICC) in Paris.
By the 1920s, commercial traders had developed a set of trade terms to describe their rights and liabilities with regards to the sale and transport of goods. These trade terms consisted of short abbreviations for lengthy contract provisions. Unfortunately, there was no uniform interpretation of them in all countries, and therefore misunderstandings often arose in cross-border transactions.