Learn how Incoterms® 2020 interact with Turkish commercial law, customs rules, the CISG, transport contracts, insurance, risk transfer, and dispute resolution. A practical 2026 guide for foreign companies trading with Turkey.

Incoterms® rules are essential tools for foreign companies buying goods from, selling goods to, or transporting products through Turkey. Terms such as EXW, FCA, FOB, CIF, CPT, CIP, DAP, DPU, and DDP determine where delivery takes place, when the risk of loss transfers, which party arranges transportation, and who bears particular logistics and customs-related costs.

However, an Incoterms® rule does not replace a properly drafted international sales contract. It does not independently determine ownership of the goods, payment conditions, product quality standards, contractual penalties, governing law, jurisdiction, or the legal remedies available after a breach.

Foreign businesses therefore receive the strongest legal protection when Incoterms® 2020 are used together with carefully drafted contractual provisions and the applicable rules of Turkish commercial, obligations, customs, transport, insurance, and private international law.

As of 2026, Incoterms® 2020 remains the current ICC version. It consists of 11 internationally recognised rules governing the allocation of delivery obligations, costs, and risks between sellers and buyers.

What Are Incoterms® Rules?

Incoterms® are standardised trade terms published by the International Chamber of Commerce. They are commonly incorporated into domestic and international contracts for the sale of goods.

Their principal function is to allocate responsibilities concerning:

• Delivery of goods
• Transfer of transportation risk
• Carriage arrangements
• Loading and unloading
• Export and import formalities
• Transport documentation
• Insurance under certain rules
• Allocation of specified costs

The Turkish Ministry of Trade also recognises standard delivery codes such as EXW, FCA, FAS, FOB, CFR, CIF, CPT, CIP, DAP, DPU, and DDP in Turkish customs and foreign-trade practice.

Do Incoterms® Automatically Apply in Turkey?

No. Incoterms® do not apply merely because a transaction concerns international trade or involves a Turkish company.

The parties must incorporate the selected rule into their sales contract, purchase order, framework agreement, or another binding commercial document.

The recommended formulation is:

FCA Istanbul Airport Cargo Terminal, Turkey, Incoterms® 2020

A complete Incoterms® clause should specify:

1. The correct three-letter rule
2. The precise named place, port, or terminal
3. The applicable edition, normally Incoterms® 2020

A clause that states only “FOB Turkey” or “CIF Europe” may be too vague. The contractual delivery point determines when risk transfers and may also affect storage, handling, demurrage, customs, and transportation costs.

What Incoterms® Do Not Regulate

Foreign businesses often make the mistake of assuming that an Incoterms® rule governs the entire commercial relationship.

Incoterms® do not generally determine:

• Transfer of legal title or ownership
• Payment method or payment deadline
• Letters of credit requirements
• Product conformity and quality
• Inspection and acceptance procedures
• Warranties
• Limitation of liability
• Liquidated damages or contractual penalties
• Force majeure
• Hardship
• Termination rights
• Governing law
• Jurisdiction
• Arbitration
• Remedies for breach

The ICC expressly explains that Incoterms® are not substitutes for a sales contract, do not decide the passing of title, and do not select the governing law or dispute-resolution method.

For example, risk may pass to the buyer when goods are delivered to a carrier, while ownership may remain with the seller until the purchase price is fully paid. These are legally distinct issues and should be separately regulated.

How Turkish Commercial Law Interacts with Incoterms®

Turkish Code of Obligations

The Turkish Code of Obligations regulates fundamental matters arising from sales contracts, including:

• Seller’s duty to deliver the goods
• Buyer’s obligation to pay the price
• Non-conforming goods
• Defects
• Delay
• Contractual damages
• Termination
• Risk-related issues not effectively regulated by contract
• General rules concerning breach of obligation

Where the parties have validly incorporated an Incoterms® rule, that rule helps define contractual delivery and risk allocation. Turkish statutory provisions may continue to govern issues that fall outside the scope of the selected Incoterms® rule.

Turkish Commercial Code

The Turkish Commercial Code applies to commercial businesses and commercial transactions and contains important provisions concerning:

• Commercial sales
• Merchants’ duties
• Notices and default
• Transportation
• Freight forwarding
• Carriage of goods
• Maritime trade
• Transport documents
• Insurance
• Commercial books and evidence

Under the Turkish Commercial Code, commercial provisions, commercial customs, and general private-law rules may operate together when resolving business disputes.

The selection of an Incoterms® rule does not eliminate the potential application of mandatory Turkish commercial, transportation, customs, or insurance provisions.

International Sale of Goods Rules

International sales involving a Turkish business may also be affected by the United Nations Convention on Contracts for the International Sale of Goods, commonly known as the CISG, where its conditions of application are satisfied and the parties have not effectively excluded it.

The CISG provides a uniform framework for international contracts involving the sale of goods, including contract formation, seller and buyer obligations, conformity of goods, damages, avoidance, and other remedies.

Incoterms® and the CISG perform different functions:

• Incoterms® primarily regulate delivery, cost, risk, transport, customs responsibilities, and certain documentation duties.
• The CISG regulates the broader international sale relationship.

A contract may therefore be simultaneously governed by the CISG, an Incoterms® 2020 rule, and supplementary national law.

The 11 Incoterms® 2020 Rules

Rules Available for Any Mode of Transport

The following rules may be used for road, rail, air, sea, or multimodal transport:

• EXW – Ex Works
• FCA – Free Carrier
• CPT – Carriage Paid To
• CIP – Carriage and Insurance Paid To
• DAP – Delivered at Place
• DPU – Delivered at Place Unloaded
• DDP – Delivered Duty Paid

Rules for Sea and Inland Waterway Transport

The following rules are intended only for sea or inland waterway transportation:

• FAS – Free Alongside Ship
• FOB – Free on Board
• CFR – Cost and Freight
• CIF – Cost, Insurance and Freight

Using FOB, CFR, or CIF for containerised multimodal shipments may create practical difficulties because containers are frequently delivered to a terminal before they are loaded onto the vessel. ICC guidance highlights FCA as a potentially more suitable rule where containerised goods are handed over to a carrier before loading on board.

Which Incoterms® Rule Best Protects a Foreign Seller?

There is no universally safest rule. The appropriate choice depends on the seller’s logistics capacity, bargaining power, customs position, payment method, transport arrangements, and willingness to assume destination-country risks.

EXW: Minimum Seller Obligation but Possible Export Problems

Under EXW, the seller generally makes the goods available at the named location, usually its premises. The buyer assumes substantial transportation responsibilities, costs, and risks from that point.

EXW may appear attractive to a foreign seller purchasing goods from Turkey or to a Turkish seller seeking minimal logistics obligations. However, it can create difficulties where the buyer cannot effectively complete export formalities or obtain evidence that the goods left Turkey.

Potential problems include:

• Buyer’s inability to act as exporter
• Lack of export customs documentation
• VAT or tax-evidence problems
• Loading disputes
• Difficulty proving export
• Limited control over transport
• Sanctions or export-control exposure

For cross-border exports, FCA is often more practical because the seller handles export clearance.

FCA: Often Suitable for Containerised and Multimodal Trade

Under FCA, the seller delivers the goods to the carrier or another person nominated by the buyer at the agreed location and generally handles export formalities.

FCA may be appropriate where:

• Goods are transported by container
• Delivery occurs at a factory, warehouse, airport, terminal, or logistics centre
• The buyer selects the main carrier
• The seller can complete Turkish export formalities
• The transaction uses multimodal transport

The contract must clearly indicate whether delivery occurs at the seller’s premises or at another named place because loading responsibilities differ.

CPT and CIP: Seller Pays Carriage but Risk Transfers Earlier

Under CPT and CIP, the seller arranges and pays for carriage to the named destination. However, the risk usually transfers when the goods are delivered to the first carrier, not when they arrive at the destination.

This distinction is frequently misunderstood.

A foreign buyer may see “CIP Munich” or “CPT London” and assume that the Turkish seller retains risk until arrival. In fact, the buyer may bear the transportation risk from an earlier delivery point even though the seller pays freight to the destination. ICC guidance confirms that under “C” rules, the place where the seller pays transportation costs may differ from the point where risk transfers.

CIP also requires the seller to arrange insurance according to the applicable Incoterms® requirements. Nevertheless, the buyer should review:

• Insurance coverage
• Exclusions
• Deductibles
• Policy currency
• Insured value
• Claims procedure
• Geographic scope
• Sanctions restrictions

DAP: Seller Delivers at Destination, Buyer Handles Import Clearance

Under DAP, the seller bears costs and risks until the goods are placed at the buyer’s disposal at the named destination, ready for unloading.

The buyer generally handles:

• Import customs clearance
• Import duties
• Import taxes
• Import licences
• Regulatory approvals

DAP may protect a foreign buyer that wants the seller to control transportation to a precise destination but is prepared to manage Turkish import procedures itself.

DPU: Seller Must Also Unload

DPU is the only Incoterms® 2020 rule requiring the seller to unload the goods at the named destination.

The seller should not accept DPU without determining:

• Whether unloading equipment is available
• Who controls the terminal
• Whether personnel can legally perform unloading
• Whether unloading costs are included
• Who bears damage caused during unloading
• Whether special permits are required

DDP: Maximum Seller Responsibility

Under DDP, the seller generally assumes extensive responsibility, including transportation to the destination and import clearance.

Foreign sellers should use DDP for deliveries into Turkey only after confirming that they can legally and practically:

• Act in the Turkish import process
• Obtain required authorisations
• Work through an authorised customs representative
• Address import duties and taxes
• Satisfy product-safety requirements
• Manage import VAT
• Obtain permits and licences
• Comply with customs valuation and origin rules

ICC guidance warns that DDP may create serious regulatory difficulties where a foreign seller cannot directly complete import formalities in the destination country. In such circumstances, DAP or DPU may be more practical.

Which Incoterms® Rule Best Protects a Foreign Buyer?

A foreign buyer purchasing from a Turkish supplier may prefer a destination-based rule such as DAP or DPU because the seller retains transportation risk for a longer period.

However, this does not always mean that a D rule is commercially superior. The buyer may have:

• Better freight rates
• Existing carrier relationships
• Better cargo insurance
• More control over customs planning
• Greater experience in the destination market
• Better ability to manage urgent shipments

A buyer using EXW, FCA, FAS, or FOB obtains greater control over the main carriage but assumes transportation risk earlier.

The most protective term is therefore the one aligned with the party’s operational capabilities and supported by appropriate insurance and contractual remedies.

Key Legal Risks for Foreign Businesses

1. Using an Incomplete Delivery Clause

“FOB Turkey” is not sufficiently precise.

The contract should identify the exact port and, where necessary, the precise terminal or delivery point:

FOB Port of Mersin, Turkey, Incoterms® 2020

A vague location may lead to disputes over inland transportation, terminal handling, storage, delivery, and risk transfer.

2. Confusing Costs with Risk

Under CFR, CIF, CPT, and CIP, the seller pays carriage to a named destination, but risk may transfer at the place of shipment or when the goods are handed to the carrier.

CFR and CIF are restricted to sea and inland waterway transport, and the risk structure under these terms must not be confused with arrival-based D terms.

3. Confusing Risk with Ownership

Incoterms® do not determine legal title.

The contract should separately state when ownership passes, for example:

• On delivery
• On payment
• On full payment
• On issuance of transport documents
• On customs clearance
• At another contractually defined stage

Retention-of-title clauses should also be reviewed under the governing law and the law of the place where the goods are located.

4. Failing to Coordinate Incoterms® with Payment Terms

The selected delivery rule must be coordinated with:

• Advance payment
• Open-account payment
• Documentary collection
• Letter of credit
• Bank guarantee
• Escrow
• Retention arrangements

For example, an L/C may require an onboard bill of lading while the contract uses FCA and delivery occurs before goods are loaded onto the vessel. Incoterms® 2020 introduced practical adjustments addressing onboard bill-of-lading needs in certain FCA transactions, but the sales contract and L/C must still be carefully coordinated.

5. Inadequate Cargo Insurance

Only CIF and CIP expressly require the seller to arrange insurance under the Incoterms® structure.

For other rules, the party bearing transportation risk must decide whether to obtain coverage.

Even where insurance is arranged, the policy may not cover:

• War risks
• Strikes
• Temperature variation
• Improper packing
• Delay
• Cyber incidents
• Sanctions-related losses
• Certain theft risks
• Consequential losses

Incoterms® 2020 also provides different default insurance expectations for CIF and CIP, reflecting the different commercial uses of these terms.

6. Customs and Importer-of-Record Problems

An Incoterms® clause cannot override mandatory Turkish customs legislation.

The contract should identify:

• Exporter of record
• Importer of record
• Customs declarant
• Customs representative
• Party responsible for tariff classification
• Party responsible for origin documents
• Party bearing additional customs assessments
• Party responsible for product conformity
• Allocation of anti-dumping or safeguard duties
• Responsibility for storage and demurrage

A DDP clause does not automatically make a foreign seller legally capable of completing Turkish import formalities.

7. Delays, Storage, Demurrage, and Detention

Incoterms® allocate some costs, but they may not resolve every consequence of:

• Customs delays
• Incorrect documents
• Port congestion
• Buyer’s failure to collect goods
• Seller’s late delivery
• Container detention
• Demurrage
• Warehousing
• Inspection
• Regulatory testing

The contract should separately determine which party bears costs caused by its own delay, error, missing documents, or regulatory non-compliance.

8. Product Compliance and Technical Regulations

Incoterms® do not fully allocate responsibility for product compliance.

Contracts involving imports into Turkey should address:

• Product safety
• Labelling
• Turkish-language requirements
• CE marking where relevant
• Technical files
• Market-surveillance documents
• Registration
• Testing
• Certificates
• Recall costs
• Regulatory penalties

The party responsible for import clearance should receive all information needed to satisfy Turkish technical and customs requirements.

9. Sanctions and Export Controls

Neither an Incoterms® rule nor a transport document eliminates sanctions risk.

Foreign businesses should screen:

• Buyer and seller
• Beneficial owners
• Banks
• Carriers
• Vessels
• Insurers
• Goods
• Destination
• Transit countries
• End users

The contract should also specify the consequences of blocked payments, denied licences, carrier refusal, or changes in sanctions laws.

Turkish Transport Law and Carrier Liability

Incoterms® determine responsibilities between the seller and buyer. They do not replace the contract of carriage between the shipper and carrier.

A cargo claim may therefore involve several separate questions:

1. Did the seller or buyer bear the risk when the damage occurred?
2. Which party contracted with the carrier?
3. Is the carrier legally liable?
4. Are liability limits applicable?
5. Was notice of damage given on time?
6. Is the cargo insured?
7. Which court or arbitral tribunal has jurisdiction?

Transport may be governed by Turkish commercial legislation or applicable international conventions concerning road, sea, air, or rail carriage.

Foreign businesses should preserve:

• Bills of lading
• CMR consignment notes
• Air waybills
• Delivery receipts
• Survey reports
• Photographs
• Customs records
• Temperature records
• Packing evidence
• Insurance notices

Dispute Resolution Under Turkish Law

Incoterms® do not choose the governing law or dispute-resolution forum. These must be addressed separately.

An international contract involving Turkey should contain provisions covering:

• Governing law
• Application or exclusion of the CISG
• Turkish court jurisdiction
• Foreign court jurisdiction
• Arbitration
• Seat of arbitration
• Language
• Number of arbitrators
• Interim relief
• Service of notices
• Enforcement of judgments or awards

Depending on the nature of the claim, a dispute may involve Turkish commercial courts, enforcement proceedings, interim injunctions, mandatory pre-litigation commercial mediation, or international arbitration.

Practical Contract Clause

A basic delivery clause may be drafted as follows:

Delivery shall be FCA Seller’s Warehouse, [full address], Turkey, Incoterms® 2020. The Seller shall complete export customs formalities. Risk of loss or damage shall pass in accordance with the FCA rule. Legal title shall pass only upon full payment of the purchase price. The allocation of customs duties, taxes, transportation costs, and insurance shall be governed by this Agreement and the incorporated Incoterms® rule. In the event of inconsistency, the express provisions of this Agreement shall prevail to the extent legally permitted.

This clause must be adapted to the actual shipment, payment mechanism, governing law, and commercial relationship.

2026 Legal and Commercial Position

As of 2026, Incoterms® 2020 remains the latest ICC edition and continues to provide 11 rules for allocating delivery obligations, costs, and transportation risks.

No new Incoterms® edition has replaced Incoterms® 2020. However, developments in digital trade, electronic transport documents, sanctions compliance, customs controls, supply-chain security, cargo insurance, and electronic bills of lading increasingly affect how these rules are implemented.

Foreign businesses should therefore avoid relying on template clauses prepared years earlier. Every transaction should be checked against:

• Current customs procedures
• Product regulations
• Sanctions
• Payment terms
• Transport documentation
• Insurance coverage
• Importer-of-record requirements
• The actual route and delivery point

Practical Checklist for Foreign Businesses

Before signing a Turkish sales contract:

1. Select the appropriate Incoterms® 2020 rule.
2. State the exact place, port, terminal, or address.
3. Confirm when transportation risk transfers.
4. Separately regulate transfer of ownership.
5. Identify the exporter and importer of record.
6. Allocate customs duties, taxes, and clearance costs.
7. Coordinate the rule with letters of credit or other payment methods.
8. Review cargo insurance.
9. Address loading and unloading.
10. Allocate demurrage, detention, and storage costs.
11. Include product-compliance obligations.
12. State governing law and jurisdiction or arbitration.
13. Determine whether the CISG applies.
14. Include sanctions and export-control clauses.
15. Establish notice, inspection, and claims procedures.

Frequently Asked Questions

1. Are Incoterms® legally binding in Turkey?

Yes, when they are validly incorporated into the parties’ contract. The clause should identify the selected rule, named place, and applicable edition.

2. Do Incoterms® 2020 replace Turkish commercial law?

No. They regulate particular delivery, cost, risk, transport, customs, and documentation responsibilities. Turkish law continues to govern matters outside their scope and mandatory legal requirements.

3. Which Incoterms® rule is safest for a foreign seller?

There is no single safest rule. FCA may be practical for exports and containerised shipments, while EXW offers limited seller obligations but can create export-clearance and documentation difficulties.

4. Which rule provides greater delivery protection for a foreign buyer?

DAP or DPU may keep transportation risk with the seller until the destination. However, the buyer must consider import clearance, unloading, cost, and control over transportation.

5. Does CIF mean the seller bears risk until the goods arrive?

No. Under CIF, the seller pays freight and arranges required insurance to the named destination, but risk generally transfers when the goods are placed on board at the port of shipment.

6. Does DDP mean a foreign seller can automatically import goods into Turkey?

No. A DDP clause does not override Turkish customs, tax, licensing, representation, or product-regulation requirements. The seller must verify that the structure is legally and operationally possible.

7. Do Incoterms® determine ownership of the goods?

No. Transfer of title must be regulated separately in the contract and may also be affected by applicable property law.

8. Are Incoterms® applicable to service contracts?

They are designed for contracts involving the sale and delivery of goods. They are generally not suitable as the primary legal framework for pure service contracts.

9. Should container shipments use FOB?

FCA is often more appropriate where containerised goods are handed over at a terminal before loading onto the vessel. The correct choice depends on the actual delivery process.

10. Can an Incoterms® dispute be brought before Turkish courts?

Yes, where Turkish courts have jurisdiction under the contract or applicable private international law. The parties may also agree to arbitration or another legally valid forum.

Legal Support for International Sales and Incoterms® Disputes

The selection of an Incoterms® rule can significantly affect transportation risk, customs responsibility, insurance coverage, and the cost of an international transaction. However, foreign businesses are protected only when the delivery term is coordinated with payment, ownership, product conformity, customs, transport, insurance, governing law, and dispute-resolution provisions.

Fırat Fesih Kaya Law Office advises foreign buyers, exporters, importers, manufacturers, distributors, logistics companies, and international investors on Incoterms® clauses, Turkish commercial contracts, customs responsibilities, cargo claims, international sales disputes, and cross-border litigation.

Phone: +90 312 434 22 22
Mobile: +90 532 769 22 22
Email: info@firatfesihkaya.av.tr
Address: Mevlana Boulevard No:221, Yıldırım Tower, No:148, 06520 Balgat, Çankaya, Ankara, Turkey

Disclaimer: This article provides general information and does not constitute legal advice. The appropriate Incoterms® rule and applicable law must be determined according to the specific goods, transport route, customs structure, payment arrangement, and contractual relationship.