EXW (Ex Works) Incoterms 2020: Rules, Obligations & Turkey Export Guide
EXW (Ex Works) is an international commercial trade term under Incoterms 2020 where the seller makes goods available at their factory or warehouse. The buyer assumes all transportation costs, risks, vehicle loading, Turkish export customs clearance, international carriage, cargo transit insurance, and destination import clearance.
Understanding EXW: Comprehensive Technical Analysis
Operational mechanism and commercial application in international freight
Under Ex Works (EXW), the seller's sole obligation is to make packaged goods available at their designated premises (factory, mill, or warehouse) at the agreed date. The seller is not obligated to load the cargo onto the buyer's collecting vehicle, nor are they legally responsible for export customs clearance in Turkey. The overseas buyer bears all freight charges, loading risks, transit hazards, export/import duties, and regulatory compliance. In Turkish cross-border trade, EXW presents administrative challenges because foreign entities cannot submit Turkish customs declarations directly without a registered Turkish tax entity or appointing an authorized local customs broker (Gümrük Müşaviri).
Matriz de obligaciones: comprador vs vendedor
Line-by-line allocation of operational duties, freight costs, and risk checkpoints
| Operational Phase | Seller Obligation | Buyer Obligation | Notes & Risk Handover |
|---|---|---|---|
| Export Packaging & Marking | Mandatory (Seller expense & risk) | None | Seller must pack goods adequately for transit. |
| Loading at Turkish Factory | No legal obligation | Responsible (Buyer bears loading cost & risk) | 📍 Seller factory floor |
| Turkish Export Customs Declaration | Assistance only (Provides commercial invoice & packing list) | Mandatory (Must appoint Turkish customs broker) | BİLGE system requires Turkish tax ID endorsement. |
| Pre-carriage & Inland Freight in Turkey | None | Mandatory (Full transport cost) | Buyer arranges pickup from seller's loading dock. |
| International Main Carriage (Road/Sea/Air) | None | Mandatory | Buyer contracts carrier and pays all freight. |
| Marine / Cargo Transit Insurance | No obligation | Recommended (Assumes full transit risk) | Seller has no duty to insure. |
| Destination Import Customs Clearance & VAT | None | Mandatory (Pays tariffs, duties, and VAT) | Buyer handles destination import clearance. |
| Final Unloading at Destination | None | Mandatory | Buyer unloads at receiving warehouse. |
Turkish Export & Customs Practice for EXW Shipments
Authoritative operational insights under Turkish Customs Law No. 4458 & border regimes
Under Turkish Customs Law No. 4458, an export declaration (İhracat Beyannamesi) submitted through the Ministry of Trade's electronic BİLGE system requires a valid Turkish tax identification number. Overseas buyers purchasing on EXW terms cannot clear Turkish customs directly without appointing a licensed Turkish customs broker (Gümrük Müşaviri) via notarized power of attorney (Vekaletname). Furthermore, to close the export file and reclaim Turkish VAT under VAT Law No. 3065, the Turkish manufacturer requires verified proof of export (VEDOP exit confirmation). For containerized or truck shipments, the ICC strongly recommends substituting FCA for EXW.
Key Turkish Export Compliance Points
- •Turkish seller must obtain verified customs exit confirmation (VEDOP) to zero-rate domestic VAT.
- •Foreign buyers must contract an authorized Turkish forwarder like Brosan Lojistik to coordinate factory pickup and customs brokerage.
- •Seller has no obligation to load the truck or container; if seller's forklift damages cargo during loading under strict EXW, buyer legally bears the loss.
Common Shipper Mistakes to Avoid
- ⚠️Foreign buyers assuming the Turkish seller will load the heavy cargo without extra fees or liability.
- ⚠️Failure of the foreign buyer to provide the Turkish supplier with export customs exit proof, preventing VAT refund.
- ⚠️Using EXW for maritime container shipments instead of modern multimodal FCA.
Preguntas frecuentes for EXW
Direct answers to high-intent questions on responsibilities, costs, and risk
Q1:Why does the ICC advise against using EXW in international trade from Turkey?
The ICC recommends FCA over EXW because foreign buyers often encounter severe legal and operational difficulties handling export customs clearance and vehicle loading in Turkey without an established local corporate entity.
Q2:Who pays for loading the truck under EXW terms at a Turkish factory?
Under strict Incoterms 2020 rules, the buyer is responsible for loading. While Turkish manufacturers frequently assist with forklifts, they do so legally at the buyer's financial risk unless 'EXW Loaded' is explicitly written in the sales contract.
Q3:How does the Turkish seller reclaim export VAT on an EXW transaction?
The Turkish seller must ensure their designated tax ID is listed on the BİLGE export customs declaration and obtain the customs exit confirmation slip (GÇB / VEDOP kapanma) from the customs broker once cargo departs Turkey.
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