Incoterms 2020

Trade has been the engine of progress since ancient times. Buying and selling is, perhaps, the most common transaction. Its varieties are retail sales contracts, supply contracts, consignment contracts and others.
Many historical and legal books, scientific articles, dissertations have been written about buying and selling. The seller and the buyer are presented in folklore in both serious and humorous ways. Many anecdotes have been composed, films have been made.


Whole legends are composed about merchants in Russia, whose iron word was valued stronger than any paper. World famous Venetian merchants are depicted in literary works.
Everyone's favorite drinking and gastronomic event "drinking of the magarychs" crowned the execution of the sales contract. Magarychs were part of the forced spending, but they have become so fond of over the centuries that even now the purchase of an apartment, a factory, a ship, a bicycle, or a car is not complete without a feast. The beliefs of "experienced victims" are heard that if the purchase is not "washed" by the abundant martyrs, then the thing may break or there will be a series of minor troubles. Currently, the term "magarych" is growing, developing and sometimes has other meanings that are not characteristic of the parties to the sale and pur-chase agreement.
In addition to the most common purchases, there are purchase and sale transactions, which are complicated by a high price, considerable risk, possible losses along the route of goods, foreign counterparties, international sanctions, intricate customs procedures, international private law, trade terms.
In international contracts with elements of sale and purchase, the current version of Incoterms 2020 is applied, which is the international rules for the interpretation of trade terms.
There are many interpretations and explanations of Incoterms. The named document is not easy to use. On the one hand, it contains the interpretation of trade terms so that participants in international relations equally well understand the subject, purpose and execution of the transaction. On the other hand, the transaction may be complicated not only by foreign elements, but also be difficult to execute at the place of the obligation. The reason is national legislation combined with judicial and fiscal systems.
Take into account simultaneously within a couple of months (when an international transaction is executed) sanctions, laws of two countries, current judicial practice, force majeure at sea or on the road, tax and duty rates, defaults, epidemics, currency fluctuations and other Incoterms 2020, of course, beyond the power. This must be understood and a competent contract must be drawn up.
In general, the use of Incoterms is associated with a number of features that business and legal service should take into account.
Firstly, Incoterms is not national civil law. It might seem like it's a law or a civil code. However, it is not. This is due to the fact that many delivery contracts are replete with fashionable terms from Incoterms. There are even textual wording that prioritizes this document. Historically, the International Chamber of Commerce in 1936 decided to publish a set of international rules for the interpretation of trade terms, now version 2020.
Secondly, it is necessary to understand the specifics of Incoterms and its dosage in contracts. Incoterms is legally useless in national contracts for the supply, carriage of goods, paid services and many others, since these are not international transactions. They do not contain a foreign element - an item (property, goods, substance, etc.) located abroad or a foreign company also registered and located abroad.
Thirdly, Incoterms is applicable only to the construction of an international purchase-or-sale agreement and only in terms of a unified understanding of trade terms. This document does not apply to other terms of contracts. Of course, you can start a discussion on this topic, pointing out that there are complex relations with the supply of equipment or other property from abroad. And such deliveries are mediated by contracts for the carriage of goods, insurance, sea transportation, etc., in which we write terms from Incoterms. But, Incoterms are not applicable to these agreements in principle.
Fourthly, Incoterms is an area of private international law.
Consequently, the legal service of the enterprise needs in the international delivery, first of all, to have the text of such an agreement with a promising level of quality for its real execution. After conciliation procedures, terms from Incoterms and an indication of its application can be added to the text of the agreement.


But only extremely accurately and dosed.
It follows that the use of Incoterms in business relations is first a tribute to fashion, and then legal, financial and risky expediency. Ignorance of the specifics of using Incoterms can lead to losses for the business.

The lawyer has significant experience in the development, editing, support and coordination at all stages of supply (purchase and sale) contracts in the field of private international law, has a sufficient level of financial education and risk planning from such contracts, knows in what cases the supply or purchase -selling need a blanket reference to the term from the Incoterms, make the correct explanation of the trade term in the contract, link the interpretation of the term with the general meaning of the contractual structure, correctly apply the necessary international convention in the contract, select the norms of the Civil Code of the Russian Federation to resolve jurisdictional conflicts, provide other qualified legal assistance in this region.