Incoterms® 2020 · Any mode of transport
EXW (Ex Works) under Incoterms® 2020
EXW places the minimum obligation on the seller: it only has to make the goods available to the buyer at its premises or another named place, not loaded on any collecting vehicle and not cleared for export. From that moment the buyer bears all costs and risks, including export formalities.
- Risk transfer
- Risk passes to the buyer when the goods are placed at the buyer's disposal at the named place of delivery, not loaded onto any collecting vehicle.
- Cost transfer
- The buyer pays all costs from the moment the goods are placed at its disposal, including loading, export clearance and carriage.
- Mode of transport
- Any mode of transport
- Insurance
- Not required, agreed between the parties
Who does what along the delivery chain
- 1Loading at seller's premisesBuyer
- 2Export clearanceBuyer
- 3Transport to port/terminal of departureBuyer
- 4Loading onto main carriageBuyer
- 5Main carriageBuyer
- 6Cargo insuranceNot required / negotiable
- 7Unloading at destinationBuyer
- 8Import clearanceBuyer
- 9Import duties & taxesBuyer
- 10Delivery to final destinationBuyer
Seller's obligations
- Provide the goods and a commercial invoice in conformity with the contract.
- Place the goods at the buyer's disposal at the agreed place and time.
- Package and mark the goods suitably for the intended transport.
- Give the buyer notice so it can take delivery.
- Assist the buyer, at the buyer's request, risk and cost, with information and documents needed for export and import clearance.
- No obligation to load; if the seller does load, it does so at the buyer's risk and expense.
Buyer's obligations
- Pay the price as provided in the contract.
- Take delivery when the goods are placed at its disposal and pay for loading.
- Carry out and pay for export, transit and import clearance.
- Contract and pay for carriage from the place of delivery to destination.
- Decide whether to insure the goods.
- Provide the seller with appropriate evidence of having taken delivery.
- Bear risks and costs if it fails to take delivery on time.
Use it when
- Domestic or regional trade with no complex export formalities.
- The buyer has a legal presence or agent able to clear exports in the seller's country.
- The buyer wants full control of the transport chain and has strong logistics capability.
- Quoting an ex-factory price to compare suppliers.
Avoid it when
- A foreign buyer cannot act as the exporter of record in Vietnam.
- The seller needs an export declaration in its own name to apply 0% VAT or claim a VAT refund.
- Payment is by letter of credit requiring a bill of lading the seller does not control.
- The seller will in fact load the buyer's truck and wants clarity on risk during loading.
Common mistakes
- Selling EXW while the seller actually handles export clearance, creating a gap between contract and practice.
- Seller loads the buyer's truck without agreeing who bears the risk of loading.
- Importer buys EXW but forgets to add origin inland transport, international freight and insurance to the customs value.
- No precise delivery address, for example just "EXW Vietnam".
Practice in Vietnam
In Vietnam, EXW runs into a real practical obstacle when the buyer is overseas. An export declaration on the VNACCS/VCIS system must be filed in the name of an entity that qualifies as exporter in Vietnam, which is normally the seller itself. The seller also needs the export declaration in its own name, together with the contract and bank payment records, to apply 0% VAT and claim refunds. As a result, many "EXW" sales are in fact cleared for export by the seller, while under Incoterms the risk already passed to the buyer at the factory. When the seller is willing to clear for export and to load, FCA at the seller's premises reflects reality better.
Worked example
A furniture factory in Dong Nai sells to an Australian buyer on "EXW Factory X, Nhon Trach 2 Industrial Park, Dong Nai, Vietnam, Incoterms® 2020". The buyer's forwarder brings an empty container to the factory, and the buyer pays for loading, haulage to Cat Lai, terminal handling, ocean freight and insurance. Because the buyer has no legal entity in Vietnam, the parties must separately agree that the factory files the export declaration at the buyer's cost; in this situation, switching to FCA at the factory would be clearer.
Frequently asked questions
Under EXW, who loads the truck?
The buyer. The seller has no obligation to load; if it does, it does so at the buyer's risk and expense unless the contract says otherwise.
Can a seller selling EXW still apply 0% VAT?
The 0% VAT rate for exports depends on having an export declaration, contract and payment records as required by law, not on the Incoterms rule. If the seller is not the declarant on the export declaration, proving the goods were exported becomes difficult.
When should EXW be replaced by FCA?
When the seller will in fact load the buyer's vehicle and clear the goods for export. FCA at the seller's premises reflects exactly those obligations.
Incoterms® is a registered trademark of the International Chamber of Commerce (ICC). This content is for general guidance and does not replace legal or banking advice for a specific transaction.
Incoterms® 2020 responsibility matrix
| Rule | Loading at seller's premises | Export clearance | Transport to port/terminal of departure | Loading onto main carriage | Main carriage | Cargo insurance | Unloading at destination | Import clearance | Import duties & taxes | Delivery to final destination |
|---|---|---|---|---|---|---|---|---|---|---|
| EXW | B | B | B | B | B | – | B | B | B | B |
| FCA | S | S | S | B | B | – | B | B | B | B |
| FAS | S | S | S | B | B | – | B | B | B | B |
| FOB | S | S | S | S | B | – | B | B | B | B |
| CFR | S | S | S | S | S | – | B | B | B | B |
| CIF | S | S | S | S | S | S* | B | B | B | B |
| CPT | S | S | S | S | S | – | B | B | B | B |
| CIP | S | S | S | S | S | S* | B | B | B | B |
| DAP | S | S | S | S | S | – | B | B | B | S |
| DPU | S | S | S | S | S | – | S | B | B | S |
| DDP | S | S | S | S | S | – | B | S | S | S |
- S Seller
- B Buyer
- S* Seller obligation (insurance)
- – Not required / negotiable
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