5 Essential Notes about: Ex Works (EXW) Incoterms
Ex Works (EXW) means that the seller delivers the goods at the disposal of the buyer at a named place or seller’s premises( i.e. factory, warehouse, …). In other words the buyer arrange the shipment from the seller premises to the final destination. It is one of the frequently used Incoterms specially in containerized and full truck shipments.
1. Which party is responsible for loading the goods at delivery place?
– There is no obligation for the seller for loading the goods on collecting vehicle. If the seller does loads, then its at the buyer risk and costs.
– Usually, the seller assist the buyer for loading like bringing the goods onto a ramp or using a fork-lift truck for loading. If the buyer intends that the seller should be obliged to assist, this must be clear by adding “loaded upon departing vehicle” after EXW in the contract of sale.
2. Should the delivery place be specified in Ex Works (EXW)?
– Its highly advised that the point within the named place of delivery be specified as clearly as possible. Since it is the point exactly at which the liability and responsibility of shipment will be transferred.
– If no specific point is specified, the seller may select the point that best suits to deliver. This delivery must be arranged on agreed date or on within the agreed period.
3. What about risks of inadequate packing in Ex Works (EXW) Incoterms?
– Although all the risks and costs are passed to the buyer after placing the goods at the buyer disposal at the named place, it does not include damages or loses caused by inadequate packing or marking of the goods.
– The seller must, on its own expenses, package the goods in the manner appropriate for their transport. Packing is to be marked appropriately. The buyer should request the seller to pack thee goods appropriate to its type of transport as the seller may not know the mode of transport.
– It is advisable also to specify the required packing in the contract of sale.
4. What if the buyer don’t take the delivery in Ex Works (EXW) named place?
– The buyer must take delivery of the goods when they have been placed at his disposal at the agreed time and place. His failure to do so will not relieve him from his obligation to pay the price and could result in a premature passing of the risk of loss of or damage to the goods or make him liable to pay additional costs.
5. What if the goods are not identified as the contract defines?
– The risk, however, cannot pass until the goods have been duly identified as the contract goods. If the goods are unascertained, i.e. goods of a certain kind which the seller will deliver to his various buyers, passing of risk occurs only when the goods are “clearly identified as the contract goods”.
To read the full obligation of the seller and the buyer in EXW Incoterms read the book “ICC Guide to Incoterms 2010”
Other useful links:
Incoterms: Shipping Guide Every Trader Must Know