Incoterms, short for International Commercial Terms, are a set of rules which define the responsibilities of sellers and buyers for the delivery of goods under sales contracts. These rules are published by the International Chamber of Commerce (ICC) and are widely used in international commercial transactions.

The main purpose of the Incoterms is to provide a uniform set of rules to assist traders when goods are sold and transported. Each Incoterm specifies:

• Who is responsible for the cost of each transportation segment
• Who is responsible for loading and unloading of goods
• Who bears the risk at any given time during the transportation process

The latest version of Incoterms is Incoterms 2020. It's crucial for sellers and buyers to agree on the Incoterm when forming a contract, as it determines who will be responsible for the cost and risk at each stage of the shipment process.