Now seems like a good time to dive into the history of Incoterms.
When were they first implemented? Why are they needed? What problem does each subsequent release aim to solve? More importantly, what can we expect to see in the future?
Below is the history of Incoterms - how they were born and how they have evolved over the years as commercial trade processes and practices have evolved.
A Brief History of Incoterms
FOB Incoterm was the first Incoterm created. Although its origins date back more than two centuries, the current Incoterms were not actually created by the International Chamber of Commerce (ICC) until 1936.
Since then, many changes have taken place in the international shipping world. To accommodate this change, new and improved versions of Incoterms appeared, such as those introduced in 1953, 1967 and 1976.
But for the past 5 years, revisions have alternated every decade and tend to be valid for the entire decade, e.g. Incoterms 1980, 1990, 2000 and 2010.
The importance of Incoterms and how they facilitate world trade cannot be denied. When Incoterms were first introduced, they were only available in 13 countries. After eight revisions, they are now widely used in over 140 countries and can be found in 31 different languages.
Reflections on the Evolution of International Trade
The world of international trade has changed a lot over the past 80 years—some big, some relatively small. These changes include new modes of transport, modifications to the types of international sales contracts, modifications to customs clearance of goods, new ways of information transfer, and more.
As this behavior changes, so must the terms that govern them. The ICC's goal of revising Incoterms is to keep shipping terms up to date and adapt to changing international trade demands.
