Expeditors International of Washington (EXPD) Status Update summary

Overview of international freight movement and risk

• International freight typically passes through multiple touchpoints, each introducing risk and requiring clear responsibility for costs and liabilities.

• Major incidents, such as vessel accidents, highlight the importance of understanding carrier liability and risk transfer.

• Legal liability for loss or damage is governed by international conventions, with strict limits and many exclusions.

Carrier liability and exclusions

• Ocean carrier liability is capped at $500 per package or shipping unit, with the definition of a unit varying by documentation and jurisdiction.

• Air carrier liability is set at 22 SDRs per kilo, increasing to 26 SDRs (about $35/kg) at the end of 2024.

• Trucking and warehousing liability in the US is typically 50 cents per pound, unless otherwise negotiated.

• Numerous exclusions apply, such as acts of God, war, and negligence, making actual recovery from carriers limited and slow.

Incoterms 2020 essentials

• Incoterms define the roles, costs, and risk transfer points between buyers and sellers in international trade.

• Only two Incoterms (CIP and CIF) require the seller to procure insurance; others do not obligate either party.

• Incoterms do not address title transfer, payment terms, or compliance with local regulations.

• The most commonly used Incoterms among retailers are FOB, FCA, Ex Works, DAP, and DDP.