In plain words
EXW gives the seller the least work and the buyer the most. The risk passes to the buyer when the goods are ready for collection at the named place. The seller does not have to load the goods onto the truck or clear them for export.
In practice, this can cause problems. The buyer is often a foreign company that cannot easily handle export customs in the seller's country, and loading accidents at the seller's site can lead to disputes. For many shipments, FCA is a better choice. Like all Incoterms rules, EXW does not decide when ownership passes or how payment is made.
Example from real shipping
A buyer in Germany buys spare parts “EXW Gebze, Incoterms® 2020”. The buyer's forwarder sends a truck to the factory in Gebze. The seller's staff help with loading, but the buyer's forwarder must arrange the Turkish export declaration. From the moment the goods were ready, the risk was with the buyer.
Related terms
- FCAUnder FCA (Incoterms® 2020), the seller clears the goods for export and hands them over to the carrier chosen by the buyer, at a named place. From there, the buyer pays the transport and takes the risk.
- DDPUnder DDP (Incoterms® 2020), the seller does almost everything: it delivers the goods to the named place in the buyer's country, clears them for import, and pays the import duties and taxes.
- Freight Collect / Freight PrepaidThese terms show who pays the main freight and where. “Freight prepaid” means it is paid at origin, usually by the shipper. “Freight collect” means it is paid at destination, usually by the consignee.
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Request a QuoteThis glossary is general information, not legal or customs advice. Rules, fees, and practice can differ by carrier, port, and country.