Incoterms for Pakistani exporters: EXW, FCA, FOB and CIF explained

Incoterms decide who pays for freight, who carries the risk, and who clears customs at each end. Choosing the wrong one can leave you responsible for costs you did not price.

The rules exporters meet most often

• EXW (Ex Works): the buyer collects at your premises. You have the least responsibility, but also little control over export clearance.
• FCA (Free Carrier): you deliver to the buyer's carrier and clear the goods for export.
• FOB (Free On Board): for sea freight only. You load the goods on the vessel; risk passes to the buyer on board.
• CFR and CIF: you pay sea freight (plus insurance under CIF), but risk still passes at loading.
• CIP, DAP, DDP: you take on more cost and responsibility, up to delivery at the buyer's destination.

Practical advice

For containerised cargo, the ICC itself suggests FCA, CPT and CIP rather than FOB, CFR and CIF. Always name the exact place (for example "FOB Karachi") and state "Incoterms 2020" in your contract and invoice.

Your choice also shapes who books freight and which documents you must provide, so agree it with your forwarder before you send a quotation.