“Carriage Paid to (CPT) UK Airport” — problem with damaged shipment
We buy under Carriage Paid to (CPT) UK Airport (Incoterms 2010 Rules) and have recently had a problem with a damaged shipment. Goods were badly damaged either during loading or unloading at the airport, a forklift truck appears to have run over one of the boxes and crashed into another. Our supplier is being very unhelpful, saying it is our problem, and is demanding their payment. We are trying to establish where the damage took place: what difference would it make to our claim on the seller if the damage was happened at the airport of loading or unloading?
Not a lot, I’m afraid. Carriage Paid to (CPT) is a term from the often misunderstood “C” group of Incoterms which include Costs + Freight (CFR) and Cost Insurance and Freight (CIF) for conventional sea freight and Carriage and Insurance Paid to (CIP) like CPT for any type of transport. Group C terms stipulate that the risk of loss or damage passes to the buyer once the goods are in the hands of the first carrier in the seller’s country. The first carrier under CPT is not the airline but the freight company collecting from the seller’s premises or the freight company accepting delivery of the goods at the airport. Unless you can prove that the damage occurred before the goods were accepted by the freight company, the risk is yours. For the seller to have the risk the term should have been DAP UK Airport (Delivered at Place). Alternatively, you could have asked the seller to specifically insure the transit risk in your name by buying the goods under Incoterms Rule Carriage and Insurance Paid to UK Airport (CIP).
It’s imperative that all employees within an internationally trading company have a clear understanding of using and applying the Incoterms® 2010 rules to suit their business needs. Update your knowledge of Incoterms at our next Training seminars taking place on the 27th September 2018 and 12th March 2019