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Ex Works (EXW) is an Incoterms® 2020 rule under which the seller makes goods available to the buyer at a named place, usually the seller’s premises. Delivery happens before the goods are loaded onto the buyer’s vehicle, so the buyer generally bears loading risk and handles transport and export formalities. EXW can suit domestic pickup or buyers with the local capability to manage collection and export, but FCA is often more practical for international shipments.
Incoterms allocate specified delivery, cost, risk, and logistics obligations between buyer and seller. They do not determine ownership, payment terms, remedies, governing law, or every other term of the sale contract.
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How EXW works
The contract should identify a named place and, ideally, the precise point where the goods will be made available. Delivery and risk transfer occur there, when the goods are placed at the buyer’s disposal—not when they are loaded or collected. If only a broad location is named, the seller may select the point within it that best suits its purpose.
EXW does not require the seller to load the goods, arrange carriage, or buy insurance. The buyer normally arranges and pays for loading, transport, and applicable export, transit, and import formalities. Local law may affect who can complete export procedures, so the parties should confirm that EXW is workable in the relevant countries.
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EXW responsibilities at a glance
| Responsibility | Seller | Buyer |
|---|---|---|
| Make conforming goods available at the agreed place and time | Yes | Take delivery |
| Package goods as required under the rule and contract | Yes | Specify transport or handling requirements as needed |
| Load the collecting vehicle | Not required | Arrange and pay; loading risk generally rests with buyer after delivery |
| Arrange and pay for carriage | Not required | Yes, from the delivery point |
| Export, transit, and import formalities | Not generally required under EXW | Generally responsible, subject to applicable law |
| Purchase cargo insurance | Not required | Optional; buyer bears risk after delivery |
The seller must provide the goods in conformity with the sales contract and the commercial invoice or other agreed evidence of conformity. At the buyer’s request, risk, and cost, the seller must assist with information or documents needed for transport, export, or security formalities when the seller has access to them. The buyer should give sufficient notice of the carrier, collection time, and other details needed for delivery.
Costs, risk, and control
An EXW price normally covers the goods and required packaging, but generally excludes loading, inland transport, export clearance, freight, insurance, import clearance, duties, taxes, and delivery to the buyer’s destination. Price and Incoterms allocation are related but not identical; confirm the commercial scope in the sales contract.
From the agreed delivery point onward, the buyer bears risk and coordinates the movement of the goods. A low EXW price is not necessarily the lowest total cost: pickup, loading, customs, insurance, and coordination expenses can outweigh apparent savings. The buyer may gain control over carriers, routes, and consolidation, especially if it already has a local collection network or freight agreements.
Pros and cons of EXW
| Party | Potential advantages | Potential disadvantages |
|---|---|---|
| Seller | Limited obligation to arrange transport or export procedures; straightforward pricing; useful for collection or domestic sales. | May have less control over export documentation and proof of export, which can complicate records or tax treatment depending on local law. |
| Buyer | Chooses carrier and route; can consolidate shipments; may benefit from existing logistics relationships. | Must coordinate pickup, loading, transport, and customs formalities; bears risk from the delivery point; may lack authority or local capacity to handle export procedures. |
EXW export clearance and loading risks
Under EXW, the buyer generally handles export clearance. A foreign buyer may not be registered or legally authorized to act as exporter in the seller’s country. The ICC advises considering FCA when the buyer expects difficulty obtaining export clearance, because under FCA the seller handles export clearance.
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1Repair Windows errors before they cause bigger problems2Fix the driver behind crashes, sound loss and screen glitches3Clear out junk files and repair common Windows errorsUnder standard EXW, the seller is not responsible for loading the collecting vehicle. This can be impractical where the seller controls the equipment or the goods require specialized handling. State in the contract who will physically load, who pays, and how the parties will allocate loading risk if their intended arrangement differs from EXW.
The seller may also need evidence that goods have been exported for tax or audit purposes. Because the seller does not control export clearance under EXW, access to export documents may be limited. The consequences depend on local law; parties should seek local customs and tax advice rather than assume EXW provides the same documentation as FCA.
EXW compared with other Incoterms
| Rule | Delivery and risk in brief | Important distinction from EXW |
|---|---|---|
| EXW | Goods made available at the named place, not loaded. | Buyer generally handles loading, carriage, and export formalities. |
| FCA (Free Carrier) | Seller delivers to the buyer’s nominated carrier or person at the agreed place. | Seller handles export clearance; if delivery is at the seller’s premises, seller generally loads the collecting vehicle. |
| FOB (Free On Board) | For sea or inland-waterway transport; seller delivers goods loaded on board the buyer-nominated vessel at the agreed port. | Seller handles export formalities. FCA is generally more appropriate for containerized goods handed to a carrier at a terminal before vessel loading. |
| DAP (Delivered at Place) | Seller arranges carriage and bears risk until goods reach the named destination ready for unloading. | Buyer generally handles import clearance. |
| DDP (Delivered Duty Paid) | Seller bears broad delivery obligations, including import formalities and associated duties and taxes, subject to the rule’s details. | May be impractical where the seller cannot legally or practically complete import procedures; DAP may be preferable. |
For many cross-border shipments, FCA is the most useful comparison: it can leave main carriage with the buyer while assigning export clearance and, at the seller’s premises, loading to the seller. The right rule depends on the goods, countries, carrier arrangements, and each party’s legal and operational capability.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.How to write an EXW term
- Name the precise delivery point and the agreed delivery date or period.
- Identify the Incoterms edition, for example: “EXW Building 4 Loading Area, 100 Industrial Road, Dallas, Texas, USA, Incoterms® 2020.”
- Agree who will load the collecting vehicle, who pays, and how loading risk is handled in practice.
- Set out collection instructions, packaging and labeling needs, and any hazardous-goods requirements.
- Specify what export documents or information the seller will provide and how the buyer will give carrier and collection details.
- Put any changes to the standard EXW allocation in the contract. Address payment, title transfer, governing law, and dispute resolution separately; Incoterms do not settle those issues.
FAQ
Does the seller load the goods under EXW?
No. Standard EXW delivery occurs before loading, and the seller is not required to load the buyer’s vehicle. Agree separately who will load and how loading risk will be handled if the seller performs the work.
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The buyer generally handles export, transit, and import formalities under EXW. Local law may limit who can act as exporter, so confirm legal and practical capability before using the rule.
Is EXW suitable for international shipments?
It can be suitable when the buyer can legally and practically manage collection, loading, and export procedures. If the buyer may have difficulty obtaining export clearance, consider FCA, under which the seller handles export clearance.
Does EXW include freight or insurance?
EXW does not require the seller to arrange carriage or insurance. The buyer generally arranges and pays for carriage from the delivery point and can choose whether to purchase cargo insurance.
What does EXW not cover?
Incoterms do not determine ownership, payment terms, remedies for breach, governing law, or dispute resolution. Address those matters in separate sales-contract terms.
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