What they are for
Incoterms are rules published by the International Chamber of Commerce. Written into your contract, they state who arranges transport, who pays which costs and when risk passes from seller to buyer.
They do not set the price of the goods or the transfer of ownership: these points must be covered in the contract.
The most common terms for imports
Under FOB, the seller loads the goods on board at the port of departure; freight and insurance are at your expense. Under CFR, the seller also pays the freight to the port of arrival, but the risk passes to you on loading. Under CIF, the seller adds minimum insurance cover. Under EXW, you collect the goods from the seller's premises and everything else is your responsibility.
FOB, CFR and CIF are reserved for sea transport. For air or multimodal shipments, FCA, CPT or CIP are used instead.
What this means for your file
The customs value generally includes freight and insurance up to the border. Tell us the Incoterm in your contract when you submit your file: we will then know which costs to attach to the declaration.