Comparison of CIP and CPT conditions in Incoterms 2020

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CIP and CPT are two important conditions mentioned in the Incoterms 2020, effective from January 1, 2020. There are several differences between these two conditions.


1. CIP (Carriage & Insurance Paid To: Carriage and Insurance Paid To)

Documentary reference: CIP [Named Place] Incoterms 2020

1.1. Seller’s responsibilities

– Deliver the goods cleared for export to the buyer’s designated delivery address. To do this, the seller will perform the following tasks:

– Produce and package the goods, ensuring sufficient production and timely delivery to the port of export.

– Export clearance.

– Contract the transportation to the buyer’s delivery address (international transport, import entry domestic transport, etc.).

– Provide assistance in supplying import documentation as requested by the buyer for import clearance.

– Contract international transport with the highest level of responsibility for the buyer (Type A provisions).

1.2. Buyer’s responsibilities

– Import clearance.

– Take delivery at the place of delivery designated by the carrier, as per the seller’s arrangement.

– Unload the goods from the transport vehicle to the destination warehouse for consumption (if agreed that the seller’s hired carrier is responsible for unloading, the buyer is not required to unload the goods from the transport vehicle).

1.3. Transfer of risk

The risk transfers from the seller to the buyer when the goods are delivered to the first carrier. Thus, the seller is responsible for delivering the goods to the designated place of receipt but does not ensure the safety of the goods.

illustration. Comparison of CIP and CPT conditions in Incoterms 2020

2. CPT (Carriage Paid To: Carriage Paid To)

Writing format: CPT [Named Place] Incoterms 2020

2.1. Seller’s responsibilities

– Deliver the goods cleared for export to the buyer’s designated place of receipt.

– Responsible for export clearance, but not responsible for import clearance. Responsible for providing permits to support the buyer’s import clearance.

– Contract the transportation to the buyer’s designated place of receipt, whether it is at the port of entry or inland in the importing country.

2.2. Buyer’s obligations

– Obliged to carry out import clearance.

– Take delivery at the designated place from the carrier engaged by the seller.

– Unload the goods into the warehouse for further consumption.

2.3. Transfer of risk

The risk transfers from the seller to the buyer when the goods are delivered to the first carrier. Thus, with CPT, the seller is responsible for delivering the goods to the designated place of receipt but does not ensure the safety of the goods. The risk remains with the buyer.

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