Freight
Incoterms explained for US importers
Independent site, not a government agency or a customs broker. General information, not legal advice or customs advice.
Take freight and insurance out of a CIF price, then read what official US sources say about these trade terms.
Customs value from a CIF price
Value duty is charged on
$22,650
| Taken out | $2,350 |
| At an 8% duty, the difference | $188 |
International freight and insurance leave the value only when they are identified separately.
Incoterms are 11 standard trade rules issued by the International Chamber of Commerce, and the current edition is 2020. The ICC sells them and holds the copyright, and we did not read its text, so this page states no one’s duties rule by rule. What follows comes from two US sources. The International Trade Administration says seven rules suit any mode of transport (EXW, FCA, CPT, CIP, DAP, DPU and DDP), and four are for sea and inland waterway (FAS, FOB, CFR and CIF). It says each rule clarifies the tasks, costs and risks of buyer and seller. It also says they do not set the price, the method or timing of payment, when title passes or which documents are needed. 7 CFR 1493.20 calls FOB, FAS, CFR and CIF customary trade terms for sea and inland waterway transport only, and FCA one for all modes. For the task-by-task content of a rule, read the ICC’s publication. Read on November 2, 2026.
Merchandise processing fee
Fee for this entry
$69.28
| Entry | formal |
| Before limits | $69.28 |
| Harbor fee, ocean | $25.00 |
Amounts for fiscal year 2027, from 1 October 2026. Goods over $250 that owe an additional duty in chapter 99 cannot use an informal entry, so the formal fee applies.
Rates read by Radif Partners · Editorial policy · Method and sources
The 11 names
| Rule | Full name | Transport, per the International Trade Administration |
|---|---|---|
| EXW | Ex Works | Any mode |
| FCA | Free Carrier | Any mode |
| CPT | Carriage Paid To | Any mode |
| CIP | Carriage and Insurance Paid To | Any mode |
| DAP | Delivered at Place | Any mode |
| DPU | Delivered at Place Unloaded | Any mode |
| DDP | Delivered Duty Paid | Any mode |
| FAS | Free Alongside Ship | Sea and inland waterway |
| FOB | Free on Board | Sea and inland waterway |
| CFR | Cost and Freight | Sea and inland waterway |
| CIF | Cost Insurance and Freight | Sea and inland waterway |
What each rule addresses
The overview says each rule addresses who provides the goods and invoice, who handles export and import licenses and formalities, who contracts for carriage, who insures, who packs, who pays for pre-shipment inspection, when delivery takes place and when risk of loss passes. It gives those as headings and does not give the answers for each rule. It also warns that its page is not legal advice, nor the official definition.
Why your trade term matters for duty
US duty is charged on the price paid or payable, without identified international transport and insurance, under 19 CFR 152.102. An example in 19 CFR 152.103 says that “the transaction value excludes C.I.F. charges”. So what counts is what your invoice shows and what you paid. If freight and insurance are in your price and shown separately, the tool above takes them out. The customs value page has more.
The rights in the rules
The ICC publishes the rules, and the International Trade Administration notes that they are protected by copyright. We are not connected with the ICC. Our wording here is our own, and it reproduces none of the rules.