01Obligations under EXW
Seller: Make goods available at premises, commercial invoice, packing list.
Buyer: Loading, export + import customs, all transport legs, insurance, all risk from factory gate.
The precise split of the 10 obligation pairs (A1–A10 / B1–B10) is binding under the ICC Incoterms 2020 rules.
02Risk and cost transfer
Risk transfer: When goods are placed at the buyer's disposal at the named place, not loaded.
Cost transfer: Buyer bears all transport and customs costs from pickup onward.
For several Incoterms, the risk and cost points do not coincide — this is the biggest source of misunderstanding in international trade. Cargo insurance should always be aligned with the risk transfer point, not the cost transfer point.
03When to use EXW
Common in domestic trade or inter-company transfers. Problematic for cross-border trade: the buyer must handle export formalities in the seller's country, which is impractical without local EORI/VAT registration.
Before choosing, verify: Can both parties operationally handle customs, carriage and insurance in the respective country? Are there tax implications (e.g. VAT under DDP)? Which documents (commercial invoice, certificate of origin, B/L, CMR, AWB) are required?
04Common pitfalls
1) Mode mismatch: EXW works for all modes — but always specify the named place precisely (city, country, optionally a terminal code) on the commercial invoice.
2) On-board notation: For sea Incoterms, a correct on-board notation on the B/L is critical for letter-of-credit settlement.
3) Insurance cover: Explicitly agree ICC A / B / C and the sum insured.
Frequently asked questions
What does EXW mean in practice?
Minimal seller obligation — buyer takes over at the seller's premises. Applicable to any mode of transport. Risk transfer: When goods are placed at the buyer's disposal at the named place, not loaded.
Who pays cargo insurance under EXW?
No mandatory insurance. The buyer bears the risk from the transfer point onwards and should insure accordingly.
Is EXW suitable for containers?
Yes. The term applies to all modes, including container transport.