2. International Trade Environment, Contracts and Incoterms

Introduction and Context

International logistics is governed not only by transport capacity and physical distribution networks, but also by a complex institutional and contractual environment. A shipment crossing borders is simultaneously an economic transaction, a customs event, a transport movement, a financial obligation and, in many cases, a regulated activity. The success of an export or import transaction therefore depends on the alignment of commercial contracts, international rules, customs procedures, transport documents, insurance arrangements and the capabilities of the parties involved.

For freight forwarders and EXIM managers, Incoterms are particularly important because they allocate responsibilities between buyers and sellers. They indicate who arranges carriage, who bears specified costs, when risk transfers, who handles export or import formalities and, in some cases, who must procure insurance. They do not, however, provide a complete sales contract. Their meaning must be understood alongside the United Nations Convention on Contracts for the International Sale of Goods (CISG), national commercial law, carriage conventions, customs legislation and the specific wording of the purchase agreement.

This chapter examines the international trade environment through the roles of the World Trade Organization (WTO), the World Customs Organization (WCO) and related institutions. It then connects those institutional arrangements with sales contracts, carriage contracts and Incoterms 2020. Particular attention is given to the distinction between cost, risk and responsibility, since confusion among these three dimensions is a major source of disputes in international trade.

Learning Objectives

After studying this chapter, the learner should be able to:

1. Explain the roles of the WTO, WCO and other institutions in international trade.

2. Distinguish a contract of sale from contracts of carriage, insurance, payment and forwarding.

3. Interpret the structure and application of Incoterms 2020.

4. Analyse the transfer of cost, risk and responsibility under different trade terms.

5. Select suitable Incoterms for different commodities, transport modes and commercial situations.

6. Identify contractual, customs, compliance and operational risks in international transactions.

7. Apply Incoterms and institutional principles to practical trade and logistics cases.

The Institutional Architecture of International Trade

The World Trade Organization

The WTO provides the principal multilateral framework for international trade in goods, services and certain aspects of intellectual property. Its agreements establish rules concerning tariffs, non-discrimination, market access, trade remedies, technical barriers, sanitary and phytosanitary measures, customs valuation and dispute settlement.

Two basic principles are especially significant. The most-favoured-nation principle generally requires a member to treat all WTO trading partners equally, subject to recognised exceptions. National treatment requires imported products, after entering the market, to receive treatment comparable to that accorded to domestic products in relevant circumstances. These principles do not eliminate tariffs or national regulation; rather, they discipline the manner in which trade measures are designed and applied.

For an EXIM manager, WTO rules are not usually applied directly to an individual shipment in the same way as a commercial contract. Their importance is indirect but substantial. They influence tariff schedules, import licensing, technical regulations, anti-dumping measures and the transparency of border administration. Changes in trade policy may alter landed cost, routing decisions, sourcing strategies and the feasibility of a contract.

The World Customs Organization

The WCO is an intergovernmental organisation concerned with customs administration and border procedures. It develops standards, conventions, guidance and capacity-building programmes. Important instruments and tools associated with the WCO include the Harmonized System for classification of goods, the Revised Kyoto Convention on customs simplification and harmonisation, the SAFE Framework of Standards for secure trade and the Data Model for standardised customs information.

The Harmonized System (HS) provides a common nomenclature for classifying goods. Correct classification affects customs duty, import restrictions, statistical reporting, licensing and the application of trade remedies. Classification is therefore not merely a clerical exercise. A mistaken code may lead to underpayment of duty, penalties, shipment delays or allegations of misdeclaration.

Customs valuation is another essential area. The transaction value method is commonly used where the legal conditions are satisfied, but customs authorities may apply alternative valuation methods when the declared value is unacceptable or cannot be established. The relationship between the parties, additions such as assists and royalties, and the treatment of freight and insurance may affect the customs value under national law.

The WCO also promotes risk management, authorised economic operator programmes, advance rulings, electronic declarations and coordinated border management. These developments support the movement from transaction-by-transaction inspection toward data-led targeting and trusted-trader facilitation.

Related Institutions and Legal Instruments

International trade is also influenced by the International Maritime Organization, the International Civil Aviation Organization, the International Labour Organization, the International Chamber of Commerce and the United Nations Commission on International Trade Law. Transport conventions establish rules for carrier liability and documentation. For example, maritime, air, road and rail carriage may be subject to different conventions and national implementations.

The ICC publishes Incoterms rules and other commercial standards. UNCITRAL has developed instruments relevant to international sale and electronic commerce. The CISG provides substantive rules for many international sales contracts, including formation, obligations of the seller and buyer, remedies and damages, unless its application is excluded or modified by the parties. National law remains important because parties may opt out of the CISG, and many subjects—including property transfer, regulatory compliance and some forms of liability—may fall outside its scope.

The institutional environment can therefore be viewed as layered:

• Multilateral rules shape the overall conditions of trade.
• Customs law governs the movement and declaration of goods at the border.
• Transport law regulates the carrier’s obligations and liability.
• Commercial law governs the sale between buyer and seller.
• Contractual terms allocate operational responsibilities between the parties.
• National regulation determines licensing, safety, tax and enforcement requirements.

A logistics manager must understand the interaction among these layers rather than treating any one rulebook as a complete answer.

Contracts in an International Transaction

An international transaction usually involves several connected but legally distinct contracts. The contract of sale is between the seller and buyer. It defines the product, quantity, price, quality, delivery obligations, payment terms, documents, remedies and applicable law. The contract of carriage is between the shipper or contracting carrier and the carrier that physically transports the goods. A freight forwarder may act as an agent arranging carriage or, depending on the agreement and jurisdiction, as a principal or contractual carrier.

Other contracts may include a cargo insurance contract, a customs brokerage agreement, a warehousing contract, a letter of credit arrangement and contracts with inland transport providers. A bill of lading, air waybill, consignment note or multimodal transport document evidences particular aspects of carriage; it does not automatically replace the sales contract.

Essential Elements of a Sales Contract

A well-designed international sales contract normally addresses:

• identity and authority of the parties;
• precise description, specifications and quantity of goods;
• price, currency, tax treatment and method of payment;
• delivery term and named place or port;
• transfer of risk and, where relevant, transfer of title;
• export, import and licensing responsibilities;
• inspection, packaging, marking and documentation;
• insurance requirements;
• force majeure and hardship;
• warranties, rejection rights and remedies;
• governing law and dispute resolution; and
• compliance with sanctions, export controls and anti-corruption rules.

A frequent mistake is to assume that an Incoterm determines title. Incoterms generally regulate delivery obligations, cost allocation and risk; they do not determine when ownership passes. Title must be addressed separately under the sales contract and applicable law.

Carriage and Forwarding Contracts

A carrier undertakes to transport goods, subject to the applicable mode-specific legal regime and contractual terms. The carrier’s liability may be limited by convention, statute or contract. A freight forwarder may arrange transport, consolidate cargo, issue documents, provide customs services or offer additional logistics services. Its precise legal role depends on the service agreement, trade practice and national law.

The distinction between a freight forwarder and a carrier is operationally important. If the forwarder acts only as an agent, the principal carrier may bear the carriage obligation. If the forwarder contracts in its own name, issues its own transport document or assumes carrier-like obligations, its liability may be broader. Written instructions should clearly identify the capacity in which the forwarder acts.

Incoterms 2020: A Framework for Delivery Responsibilities

Incoterms 2020 contains eleven rules. Seven apply to any mode or combination of modes: EXW, FCA, CPT, CIP, DAP, DPU and DDP. Four are intended for sea and inland waterway transport: FAS, FOB, CFR and CIF. The rules should be used with a precise named place, for example, “FCA Seller’s Warehouse, Pune, Incoterms 2020” or “CIP Frankfurt Airport, Incoterms 2020.”

The rules answer three central questions:

1. Where does delivery occur and when does risk transfer?

2. Which party arranges and pays for transport and related services?

3. Which party handles export, transit and import formalities?

They do not determine the full sales price, payment method, title, breach remedies, product conformity or the carrier’s independent liability.

The Seven Rules for Any Mode of Transport

EXW—Ex Works. The seller makes the goods available at its premises or another named place. Risk and most costs transfer when the goods are placed at the buyer’s disposal, before loading on the collecting vehicle. EXW places extensive responsibility on the buyer and may be unsuitable for an export transaction where the buyer cannot legally or practically complete export formalities. FCA is often more appropriate.

FCA—Free Carrier. The seller delivers the goods to the carrier or another person nominated by the buyer at the named place and completes export clearance where required. If delivery occurs at the seller’s premises, the seller loads the goods onto the collecting vehicle. If delivery occurs elsewhere, the seller brings the goods to that place ready for unloading. FCA is versatile and generally suitable for containerised cargo, multimodal movements and air freight.

CPT—Carriage Paid To. The seller contracts and pays for carriage to the named destination, but risk transfers when the goods are handed to the first carrier, not when they reach the destination. This separation of cost and risk is fundamental. The buyer should arrange insurance if protection is required.

CIP—Carriage and Insurance Paid To. Like CPT, risk transfers at handover to the first carrier, while the seller pays carriage to the named destination. The seller also procures cargo insurance meeting the higher insurance obligation associated with CIP under Incoterms 2020, subject to the rule and contract requirements. Insurance is for the buyer’s risk after delivery; it does not mean that the seller retains risk until destination.

DAP—Delivered at Place. The seller bears cost and risk until the goods are placed at the buyer’s disposal at the named destination, ready for unloading. The buyer normally handles import clearance, import duties and unloading. DAP is useful where the seller controls the main movement but the buyer is better positioned to manage import formalities.

DPU—Delivered at Place Unloaded. The seller delivers and unloads the goods at the named destination. Risk transfers after unloading. The seller should ensure that the destination is suitable for unloading and that the transport arrangement supports this obligation. DPU replaced DAT in Incoterms 2020.

DDP—Delivered Duty Paid. The seller bears the broadest range of obligations: transport to destination, export and transit formalities, import clearance, duties and taxes, subject to the rule. DDP can be attractive to buyers but may be impractical where the seller cannot legally act as importer, obtain local tax registration or manage import controls. It should not be selected merely because it appears customer-friendly.

Rules for Sea and Inland Waterway Transport

FAS—Free Alongside Ship. The seller delivers when goods are placed alongside the vessel at the named port of shipment. The buyer bears loading, main carriage and subsequent risk. FAS is more suitable for bulk or project cargo delivered directly alongside a vessel than for ordinary container shipments.

FOB—Free On Board. The seller delivers when goods are loaded on board the vessel nominated by the buyer at the named port of shipment. Risk transfers at that point. FOB is designed for port-to-port sea or inland waterway shipments and is generally inappropriate for container cargo handed to a terminal before vessel loading, because the seller no longer controls the goods at the point of physical handover. FCA is normally more accurate for such container movements.

CFR—Cost and Freight. The seller pays freight to the destination port, but risk transfers when the goods are loaded on board the vessel at the shipment port. The buyer normally arranges insurance. The separation between freight payment and risk transfer must be communicated clearly.

CIF—Cost, Insurance and Freight. The seller pays freight and procures the insurance required by the rule to the destination port, while risk transfers when goods are loaded on board at the shipment port. CIF is intended for sea and inland waterway transport. Like CIP, it does not mean that the seller bears transit risk until arrival.

Cost, Risk and Responsibility: Three Different Allocations

The most important analytical discipline in using Incoterms is to separate cost, risk and responsibility.

Cost concerns who pays for transport, loading, terminal handling, documentation, insurance and other services. Risk concerns who bears the consequences of loss or damage at a specified point. Responsibility concerns who must perform an activity, such as export clearance, booking transport, obtaining licences or unloading goods. These dimensions may change at different points.

Under CPT, for example, the seller pays carriage to the destination, but risk transfers at the first carrier. Under DAP, the seller bears both destination transport cost and risk until arrival ready for unloading. Under CIF, the seller pays freight and insurance, but risk transfers on board at the shipment port. A manager who reads only the phrase “freight paid” may incorrectly assume that the seller bears transit risk.

A practical allocation matrix should identify at least:

| Activity | Seller | Buyer | Depends on contract or local law |

|---|---|---|---|

| Export clearance | Often seller under most terms | Usually buyer under EXW | National law may restrict allocation |

| Main carriage | Seller under C, D terms | Buyer under E, F terms | Named place and agreement matter |

| Cargo insurance | Seller under CIP/CIF obligation | Usually buyer otherwise | Coverage level must be specified |

| Import clearance and duties | Buyer except generally DDP | Usually buyer | Importer-of-record rules are decisive |

| Unloading at destination | Usually buyer under DAP | Buyer under DAP | Seller under DPU |

| Transit risk | Depends on delivery point | Depends on delivery point | Insurance and evidence are separate |

The named place is as important as the three-letter rule. “DAP warehouse” may create uncertainty about unloading, access, congestion, demurrage and the exact point of delivery. Contracts should identify a practicable and legally meaningful location, preferably with terminal, gate, warehouse or port details where relevant.

Choosing an Appropriate Incoterm

Term selection should begin with the transaction rather than with habit. The following questions provide a useful managerial framework:

1. What is the mode of transport? If the cargo is containerised or multimodal, an all-mode rule such as FCA, CPT or CIP is usually preferable to FOB, CFR or CIF.

2. Who controls the transport relationship and has stronger bargaining power with carriers?

3. Can the seller or buyer legally perform export and import formalities?

4. Who can obtain reliable cargo insurance and manage claims?

5. Where should risk transfer in relation to production, loading and carrier handover?

6. Is the destination capable of receiving, unloading and storing the goods?

7. Are duties, taxes, sanctions, licences or product controls likely to create compliance risk?

8. Does the price quotation clearly identify included and excluded costs?

9. Are payment and documentary-credit requirements consistent with the selected term?

10. Do the parties understand that the Incoterm does not determine title or payment?

The seller may prefer FCA where it wants control over export clearance but not international transport. A buyer with strong freight contracts may prefer FCA or FOB in an appropriate mode. A buyer seeking a delivered price may prefer DAP, while a seller with a robust destination-country organisation may offer DDP. The cheapest apparent term is not necessarily the lowest total-cost option; administrative burden, delay, insurance gaps and customs risk must also be valued.

Applied Illustrative Case: Selecting a Term for Containerised Machinery

Background

A manufacturer in India is selling specialised machinery to a customer in Germany. The goods will move in containers by truck, ocean vessel and rail to the buyer’s facility. The buyer initially requests FOB Mumbai because it has used FOB in earlier purchases. The seller proposes DDP because it wants to offer a complete delivered price.

Situation and Problem

The machinery is expensive, requires export packing and may need technical documentation for import. The German buyer has an established customs broker and is registered to act as importer. The Indian seller has no German tax registration, no local customs infrastructure and limited knowledge of German product compliance. The parties must choose a term that reflects the actual capabilities of both sides.

Analysis

FOB is unsuitable because the movement is containerised and multimodal. The seller is likely to deliver the container to a terminal before the goods are loaded on the vessel, while FOB defines delivery and risk transfer at loading on board. FCA at the seller’s premises or a named terminal would more accurately describe the handover.

DDP would transfer extensive obligations to the seller, including import clearance, duties and taxes. The seller may be unable to act as importer or satisfy local tax and regulatory requirements. The buyer, by contrast, has a functioning customs relationship and can manage import procedures.

CIP to the buyer’s facility could provide the buyer with a delivered transport arrangement and seller-procured insurance, but risk would transfer when the goods are handed to the first carrier. If the buyer prefers to control insurance and already has a global policy, CPT could be considered. DAP would place risk with the seller until delivery at the facility, while the buyer would handle import formalities and unloading. The final choice depends on the seller’s ability to manage destination transport and the parties’ preferred risk position.

Approach and Solution

The parties select DAP Buyer’s Facility, Germany, Incoterms 2020, with the named location and unloading responsibility expressly described. The buyer remains importer of record and handles import clearance, duties and taxes. The seller arranges carriage and bears risk until the machinery is made available at the agreed destination, ready for unloading. The contract separately specifies packaging, insurance expectations, delivery appointment procedures, demurrage allocation, technical documents, payment milestones and transfer of title.

Outcome

The term aligns the commercial promise with operational capability. The seller provides a meaningful delivered service without undertaking import obligations it cannot lawfully perform. The buyer retains control of customs compliance and avoids uncertainty over the use of FOB for a container movement.

Learning Points

The case demonstrates that a familiar term may be technically inappropriate. It also shows why delivery, risk, customs responsibility and title must be analysed separately. A correct Incoterm reduces ambiguity, but it cannot substitute for a complete contract and a realistic logistics plan.

Risks, Mistakes and Professional Controls

Common mistakes include using FOB for all exports, treating CIF or CIP as proof that the seller bears risk to destination, failing to specify the named place, confusing title with delivery, ignoring importer-of-record requirements and assuming that Incoterms determine customs valuation. Another error is to select DDP without checking taxes, licences, local representation and the seller’s legal ability to import.

Operational controls should include a written Incoterm approval process, a responsibility matrix, document checklists, tariff-classification review, sanctions screening, insurance verification and confirmation of the exact delivery point. Commercial, tax, customs, legal and logistics teams should review high-value or regulated shipments jointly.

Ethically and professionally, parties must not manipulate classification, invoice values, origin claims or Incoterms to evade duty or regulatory controls. A freight forwarder should communicate limitations clearly and avoid representing that a term provides insurance, customs clearance or legal compliance when it does not. Records must support the declared transaction, and conflicts of interest in brokerage, routing or supplier selection should be disclosed.

Digitalisation and Emerging Developments

Electronic trade documents, single-window customs platforms, automated classification tools, track-and-trace systems and supply-chain visibility platforms are changing the administration of international trade. Data from purchase orders, transport documents, customs declarations and warehouse systems can be integrated to identify discrepancies before shipment. Analytics may flag unusual values, inconsistent HS codes, repeated amendments or routes associated with higher compliance risk.

Artificial intelligence can assist document extraction, landed-cost estimation and anomaly detection, but it should not replace expert review. Classification and origin decisions require authoritative sources and contextual judgement. Digital systems also create cybersecurity, data-quality and privacy risks. Electronic records must be controlled through access rights, audit trails, validation rules and retention policies.

Recent trade practice also places greater emphasis on resilient supply chains, trusted-trader programmes, paperless trade, sustainability data and carbon-related reporting. These developments increase the importance of accurate, standardised data across commercial and logistics functions.

Best Practices for EXIM and Freight-Forwarding Professionals

A sound operating approach is to:

• identify the legal roles of seller, buyer, forwarder, carrier and broker;
• write the Incoterm with the exact named place and version;
• separate cost, risk, responsibility and title in the contract;
• match the rule to the transport mode and physical handover point;
• verify export and import capability before selecting EXW or DDP;
• confirm insurance coverage, exclusions, deductibles and claims procedures;
• validate HS classification, origin, valuation and licensing requirements;
• align the term with documentary-credit and payment requirements;
• record the agreed allocation in quotations, purchase orders and transport instructions; and
• review unusual or high-value transactions through legal, customs and insurance specialists.

Chapter Summary

International trade operates through interacting layers of multilateral, customs, transport and commercial law. The WTO establishes broad rules for trade relations, while the WCO promotes harmonised customs classification, valuation, security and facilitation standards. Sales contracts, carriage contracts, insurance contracts and forwarding agreements perform different legal functions and must not be conflated.

Incoterms 2020 provides eleven rules for allocating delivery obligations, selected costs and risk between seller and buyer. The seven all-mode rules are EXW, FCA, CPT, CIP, DAP, DPU and DDP; the four sea and inland-waterway rules are FAS, FOB, CFR and CIF. The central analytical principle is that cost, risk and responsibility may transfer at different points. A suitable term depends on mode, control, customs capability, insurance, regulatory capacity, destination conditions and commercial strategy. Incoterms do not determine title, payment, product ownership or the entire sales relationship. Effective EXIM management therefore combines correct term selection with precise contracts, reliable data, compliance controls and operational coordination.

Key Terms

Incoterms 2020: ICC rules allocating specified delivery obligations, costs and risks between seller and buyer.

WTO: International organisation administering multilateral rules for trade in goods, services and intellectual property.

WCO: International organisation developing customs standards, tools and cooperation frameworks.

Harmonized System: International goods-classification nomenclature used for customs and trade statistics.

Customs valuation: Determination of the value of imported goods for duty and related purposes.

Contract of sale: Agreement defining the seller’s and buyer’s commercial rights and obligations.

Contract of carriage: Agreement under which a carrier undertakes to transport goods.

Freight forwarder: Intermediary arranging transport and related logistics services, sometimes acting as principal.

Named place: Precisely identified location specified in an Incoterm where delivery or another obligation occurs.

Delivery: The Incoterms event at which the seller fulfils the rule’s delivery obligation and risk transfers.

Risk transfer: Movement of responsibility for loss or damage from seller to buyer.

Cost allocation: Distribution of transport, handling, insurance and related expenses between parties.

FCA: Rule requiring the seller to deliver goods to the buyer’s nominated carrier and generally complete export clearance.

CIP: Rule under which the seller pays carriage and specified insurance while risk transfers at first-carrier handover.

DAP: Rule requiring the seller to deliver goods ready for unloading at the named destination.

DDP: Rule imposing extensive delivery, import-clearance and duty obligations on the seller.

FOB: Sea or inland-waterway rule transferring delivery when goods are loaded on board the nominated vessel.

CIF: Sea or inland-waterway rule where the seller pays cost, insurance and freight, but risk transfers on board.

Importer of record: Party legally responsible for import declaration and compliance in the destination country.

Authorised Economic Operator: Trusted trader recognised by customs for meeting specified security and compliance standards.

Review Questions

Short Answer Questions

1. What are the principal functions of the WTO in international trade?

2. Why is HS classification important to an EXIM manager?

3. Distinguish a contract of sale from a contract of carriage.

4. What does a named place accomplish in an Incoterm?

5. Why does risk under CPT not transfer at the destination?

Long Answer Questions

1. Explain the institutional relationship among the WTO, WCO, transport conventions and commercial contracts.

2. Discuss the differences among cost, risk and responsibility under Incoterms 2020.

3. Compare FCA, FOB and CIF, including their suitable transport applications.

4. Explain the legal and operational risks of selecting DDP without destination-country capability.

5. Describe a systematic managerial process for selecting an Incoterm.

Analytical / Application Questions

1. A buyer requests FOB for containerised cargo moving by road, sea and rail. Analyse whether FOB is appropriate and recommend an alternative.

2. Under CIP, goods are damaged after handover to the first carrier but before arrival. Analyse the parties’ risk position and the relevance of insurance.

3. A seller wants to quote DDP but cannot obtain import registration in the destination country. Design a more suitable delivery arrangement and justify it.

22. Multiple Choice Questions with Answers

Question 1

Which organisation is most directly associated with the Harmonized System of goods classification?

A. World Trade Organization

B. World Customs Organization

C. International Chamber of Commerce

D. International Maritime Organization

Correct Answer: B. World Customs Organization

Question 2

Under CPT, when does risk generally transfer from seller to buyer?

A. When goods arrive at the named destination

B. When the buyer completes import clearance

C. When goods are handed to the first carrier

D. When the buyer pays the seller

Correct Answer: C. When goods are handed to the first carrier

Question 3

Which Incoterm requires the seller to unload goods at the named destination?

A. DAP

B. DPU

C. CPT

D. FCA

Correct Answer: B. DPU

Question 4

Why is FCA generally more suitable than FOB for containerised multimodal cargo?

A. FCA eliminates all customs duties

B. FCA transfers title at the destination

C. FCA reflects delivery to the carrier before vessel loading

D. FCA always requires seller-procured insurance

Correct Answer: C. FCA reflects delivery to the carrier before vessel loading

Question 5

Which statement correctly describes CIF?

A. Risk remains with the seller until destination delivery

B. The buyer always handles export clearance

C. The seller pays freight and specified insurance, while risk transfers on board

D. It applies equally to air and road transport

Correct Answer: C. The seller pays freight and specified insurance, while risk transfers on board

Question 6

Which issue is not normally determined by an Incoterm?

A. Specified delivery obligations

B. Allocation of certain transport costs

C. Transfer of ownership or title

D. Point of risk transfer

Correct Answer: C. Transfer of ownership or title

Question 7

A seller lacks the legal ability to act as importer in the destination country. Which term should be treated with particular caution?

A. DDP

B. FCA

C. CPT

D. FAS

Correct Answer: A. DDP

Question 8

Under DAP, which party normally handles import clearance and import duties?

A. Seller

B. Buyer

C. Carrier

D. Insurance provider

Correct Answer: B. Buyer

Question 9

A freight forwarder issues its own transport document and contracts in its own name. What may follow?

A. It can never have liability for carriage

B. It may assume carrier-like contractual obligations

C. The buyer automatically becomes the exporter

D. Incoterms no longer apply to the sale

Correct Answer: B. It may assume carrier-like contractual obligations

Question 10

Which combination best represents a sound Incoterm selection process?

A. Choose the term most commonly used by competitors

B. Choose the lowest quoted freight price only

C. Match mode, handover point, customs capability, insurance and risk preference

D. Use DDP whenever the buyer requests a delivered price

Correct Answer: C. Match mode, handover point, customs capability, insurance and risk preference