Ex Works (EXW)
Seller fulfils its obligation by making the goods available at its own premises; the buyer bears nearly all transport, export clearance and risk thereafter.
Ex Works (EXW) places the minimum obligation on the seller and the maximum on the buyer under Incoterms 2020. The seller delivers when it places the packed goods at the buyer's disposal at the named place (usually its own factory or warehouse), without loading them onto any collecting vehicle and without clearing them for export. From that moment all costs and risks — loading, inland carriage, export clearance, main freight, insurance, import clearance and duties — pass to the buyer.
EXW can be used for any mode of transport. While simplest for the seller, Chinese exporters should note two practical pitfalls: (1) under the rule the buyer handles export declaration, but China's VAT export-refund normally requires the declaration to be filed under the domestic exporter's name with a proper customs declaration form — so the parties must agree in advance who declares and under whose name, or the refund may be lost; (2) if the seller assists with loading at its premises, the allocation of risk can become disputed. In practice many so-called EXW deals are closer to FCA; exporters who will assist with loading or handle export clearance should prefer FCA.
FAQ
- Can I still claim China's export VAT refund under EXW terms?
- Whether you get the refund depends on who declares the export and under whose name, not on the Incoterm itself. EXW assigns export clearance to the buyer, but China's refund requires the declaration to be filed under the domestic exporter's name with a customs declaration form and VAT invoice. You must contract separately for the seller to declare (or declare under the seller's name); otherwise you may not obtain the customs form and lose the refund. For refund needs, switch to FCA and spell out the clearance arrangement.
- Under EXW, who bears the risk while loading at the seller's premises?
- Strictly, delivery is complete once goods are at the buyer's disposal; loading is not the seller's obligation, so loading risk is in principle the buyer's. If the seller nonetheless helps load, liability becomes hard to allocate when something goes wrong. If you want the seller to load and bear that risk, use FCA (delivery at seller's premises, loading included).
Related terms
Sources: https://iccwbo.org/business-solutions/incoterms-rules/incoterms-2020/