International Shipping and Delivery Disputes: Who Bears the Risk When Goods Are Lost or Damaged?

Seller, Buyer, Carrier and Insurer Liability in Cross-Border Trade and the Role of Incoterms®

International trade depends upon the physical movement of goods across borders.

A Turkish manufacturer may sell machinery to Germany. A European distributor may purchase electronic components from China. A company in Istanbul may import industrial equipment from the United States, while a Turkish exporter may send textiles, automotive components or food products to customers throughout Europe and the Middle East.

In every transaction, something can go wrong between dispatch and delivery.

Goods may be:

• lost during transportation;
• damaged inside a container;
• stolen from a truck;
• destroyed during loading or unloading;
• delayed at a port;
• detained by customs;
• rejected because of incorrect documentation;
• exposed to water or temperature damage;
• delivered to the wrong consignee;
• released without presentation of the proper transport document; or
• damaged during multimodal transportation involving several different carriers.

When this happens, the apparently simple question — “Who pays for the loss?” — can become legally complicated.

The answer may depend on at least four separate legal relationships:

1. the contract between seller and buyer;
2. the applicable Incoterms® rule;
3. the contract between the cargo interest and the carrier; and
4. the cargo insurance policy.

International conventions such as the United Nations Convention on Contracts for the International Sale of Goods (“CISG”), the Convention on the Contract for the International Carriage of Goods by Road (“CMR”), the Montreal Convention 1999 for air carriage and applicable maritime carriage regimes may create additional rules.

The most important principle is therefore:

Risk allocation between seller and buyer is not the same thing as carrier liability for damaged cargo.

Understanding this distinction is essential for resolving international shipping disputes.

1. The First Question: When Did the Risk Pass From Seller to Buyer?

When goods are damaged during international transportation, many businesses immediately ask whether the carrier was negligent.

That question may eventually become important, but the first question under the sales contract is usually different:

Who was bearing the contractual risk at the exact moment when the loss occurred?

Suppose USD 500,000 worth of machinery is sold by a Turkish supplier to a French buyer.

The machinery is loaded onto a truck in Istanbul and damaged during transportation through Europe.

Depending on the agreed delivery term, the economic risk may already have passed to the French buyer before the accident.

Alternatively, the Turkish seller may still have been bearing the risk until delivery at the buyer’s warehouse.

The fact that the seller arranged and paid for transportation does not necessarily answer the question.

This is precisely why Incoterms® rules are so important.

2. What Do Incoterms® Actually Do?

The International Chamber of Commerce (“ICC”) describes Incoterms® as eleven standard trade terms used in domestic and international sale contracts to clarify the allocation of tasks, costs and risks between sellers and buyers.

The current version is Incoterms® 2020, which entered into force on 1 January 2020.

Incoterms® determine important matters including:

• where delivery takes place;
• when risk passes from seller to buyer;
• who arranges transportation;
• who pays freight costs;
• who performs export or import clearance;
• and, under certain rules, who must arrange cargo insurance.

But Incoterms® do not constitute a complete sales contract.

They do not automatically determine matters such as:

• transfer of legal ownership;
• payment terms;
• whether payment must be made by letter of credit;
• consequences of all contractual breaches;
• governing law;
• dispute-resolution forum;
• or every aspect of carrier liability.

The parties should therefore incorporate the appropriate Incoterms® rule into a properly drafted international sales contract.

A clause should normally identify both the specific place and the version of the rules, for example:

FCA Istanbul Airport, Türkiye – Incoterms® 2020

rather than simply stating:

FCA Turkey.

The precise location can determine the exact moment at which risk changes hands.

3. FCA: Risk May Pass Much Earlier Than the Buyer Expects

Under FCA – Free Carrier, the seller delivers the goods to the carrier or another person nominated by the buyer at the agreed place.

If the named place is the seller’s premises, delivery occurs when the goods are loaded onto the collecting vehicle.

If another location is agreed, the rule operates according to the delivery mechanism specified by Incoterms® 2020.

The ICC explains that the selected place of delivery determines both where risk transfers and when relevant costs begin to fall on the buyer.

Consider:

FCA Seller’s Factory, Bursa – Incoterms® 2020

The Turkish seller manufactures automotive parts worth EUR 250,000.

The buyer appoints a logistics company.

The parts are properly loaded onto the buyer’s carrier at the Bursa factory.

The truck subsequently overturns in Bulgaria.

Although the seller manufactured the goods and the buyer has not yet physically received them in Germany, the transportation risk may already have passed to the buyer at the agreed FCA delivery point.

The buyer may then need to pursue the carrier or cargo insurer rather than demand replacement from the seller — unless the loss resulted from a separate breach by the seller.

4. CPT and CIP: Paying Freight Does Not Necessarily Mean Bearing the Risk

One of the most misunderstood features of Incoterms® concerns the “C” terms.

Under CPT – Carriage Paid To, the seller contracts and pays for transportation to the named destination.

However, the ICC explains that risk generally transfers when the goods are handed over to the carrier, rather than when they physically arrive at the final destination.

This produces an important separation between cost and risk.

For example:

CPT Munich, Germany – Incoterms® 2020

A Turkish seller may be required to pay freight all the way to Munich.

Yet the risk may have transferred to the German buyer when the seller handed the cargo to the first carrier in Türkiye.

If the cargo is destroyed halfway through the journey, the buyer cannot automatically argue:

“The seller paid the transportation, therefore the seller bears the loss.”

That conclusion may be wrong.

The same fundamental risk-transfer mechanism applies to CIP – Carriage and Insurance Paid To, although under CIP the seller must also procure insurance meeting the required contractual standard.

5. CIP and CIF: Insurance Does Not Mean the Seller Retains Transportation Risk

Insurance obligations create another frequent source of confusion.

Under CIP, the seller arranges carriage and insurance, but risk generally passes when the goods are handed to the carrier.

Under CIF – Cost, Insurance and Freight, which is designed for sea and inland-waterway transport, the seller similarly arranges freight and insurance to the destination port while risk transfers according to the sea-shipment delivery point.

Incoterms® 2020 differentiates the level of insurance required under CIP and CIF.

The ICC states that CIP requires the higher level of cover associated with Institute Cargo Clauses (A) or similar coverage, while CIF retains Institute Cargo Clauses (C) as the default minimum level unless the parties agree otherwise.

This distinction can matter significantly.

The fact that insurance exists does not mean that every loss is insured.

Policies may contain:

• exclusions;
• deductibles;
• valuation provisions;
• packaging requirements;
• notification requirements;
• territorial limitations;
• sanctions exclusions;
• temperature-control conditions;
• or exclusions relating to delay or inherent vice.

The insurance policy therefore needs to be examined independently from the Incoterms® rule.

6. FOB, CFR and CIF: Special Rules for Maritime Trade

FOB, CFR and CIF are designed for sea and inland-waterway transportation rather than ordinary containerised multimodal transportation.

Under these rules, the point at which the goods are placed on board the vessel is particularly important.

A common mistake is to use FOB automatically for container shipments merely because the goods will eventually travel by ship.

Where goods are delivered to a container terminal before loading onto the vessel, FCA may often reflect the commercial arrangement more accurately.

The distinction becomes crucial if the goods are damaged inside the terminal before being loaded.

Under an improperly selected Incoterms® rule, the parties may later disagree about whether the relevant delivery point had already occurred.

International sales contracts should therefore select Incoterms® according to the actual logistics chain rather than commercial habit.

7. DAP, DPU and DDP: Seller Bears Risk Until Destination

The “D” terms create a significantly different risk profile.

Under DAP – Delivered at Place, the seller bears transportation risks until the goods are placed at the buyer’s disposal at the agreed destination, ready for unloading.

Under DPU – Delivered at Place Unloaded, the seller bears the risk until the goods have actually been unloaded and placed at the buyer’s disposal.

DPU is therefore unique among the current Incoterms® rules because the seller’s delivery obligation includes unloading.

Under DDP – Delivered Duty Paid, the seller carries the greatest responsibility. The seller bears risk to the agreed destination and is generally responsible for both export and import customs formalities.

The ICC characterises DDP as the Incoterms® rule imposing the maximum level of responsibility on the seller.

The difference between DAP and DDP becomes particularly important in customs disputes.

Under DAP, the buyer normally handles import clearance.

Under DDP, the seller assumes responsibility for import formalities.

Consequently, the party responsible for goods becoming trapped in customs may depend heavily upon which delivery term was selected.

8. Customs Detention: Who Bears the Loss?

Suppose goods arrive in Türkiye but cannot clear Turkish customs.

Possible reasons include:

• incorrect HS classification;
• missing certificate of origin;
• incorrect invoice;
• absence of an import licence;
• product-safety restrictions;
• sanctions;
• missing conformity documentation;
• incomplete customs declarations;
• valuation disputes;
• or failure to pay customs duties.

Responsibility cannot be determined merely from the fact that the goods are physically located at customs.

The contract must identify who had the obligation to complete the relevant clearance procedure.

Under DAP and DPU, the buyer generally handles import formalities.

Under DDP, the seller normally assumes them.

However, the analysis does not necessarily end there.

Suppose the buyer is responsible for import clearance under DAP, but customs refuses entry because the seller supplied a materially incorrect commercial invoice.

The seller may still face liability for breach of its documentary obligations.

Conversely, if the seller has provided every document required by the contract but the buyer fails to obtain an import permit for which it was responsible, storage and demurrage costs may potentially fall on the buyer.

The cause of the customs problem is therefore as important as the Incoterms® rule itself.

9. The CISG and Passing of Risk

In many cross-border B2B transactions, the United Nations Convention on Contracts for the International Sale of Goods (“CISG”) may apply.

The CISG establishes a uniform legal framework for international sales contracts between businesses in different Contracting States, subject to its scope and any valid exclusion or modification by the parties.

Türkiye acceded to the CISG on 7 July 2010, and the Convention entered into force for Türkiye on 1 August 2011.

This is especially important for Turkish importers and exporters.

Many companies assume that inserting a clause such as “Turkish law applies” automatically excludes the CISG.

That assumption can be dangerous.

Because the CISG forms part of the applicable sales-law framework in Contracting States, parties wishing to exclude it should generally address exclusion expressly and carefully.

10. CISG Articles 66–70 and Transportation Risk

Articles 66–70 of the CISG address the passing of risk.

The basic logic is that once risk has passed to the buyer, accidental loss or damage generally does not release the buyer from its obligation to pay the price, unless the loss resulted from an act or omission attributable to the seller.

For contracts involving carriage, the point at which goods are handed over to the relevant carrier can become particularly important.

UNCITRAL materials concerning Articles 66–70 emphasise the relationship between contractual delivery obligations and the transfer of transportation risk. They also recognise that parties may alter the CISG’s default allocation through agreement, including by incorporating an Incoterms® rule.

This is the practical relationship between the CISG and Incoterms®:

the CISG can provide the underlying international sales-law regime, while the selected Incoterms® rule may specifically define the parties’ delivery and risk allocation.

11. Risk Passing Does Not Excuse the Seller’s Own Breach

Passing of risk does not give a seller complete immunity.

Suppose risk has passed to the buyer, but the cargo is later destroyed because the seller packaged hazardous chemicals incorrectly.

Or suppose machinery develops major internal damage during transport because it was improperly secured before shipment.

The seller cannot necessarily rely on the risk-transfer clause as a defence where its own breach caused the loss.

This distinction is reflected in the CISG framework.

Risk allocation concerns accidental loss.

It does not automatically eliminate remedies arising from the seller’s non-conforming performance.

An expert investigation may therefore be necessary to distinguish:

transportation damage from pre-existing non-conformity.

That distinction can determine whether the claim lies primarily against the seller, the carrier or the insurer.

12. Carrier Liability Is a Separate Legal Question

Once the party bearing the risk has been identified, the next question is:

Can that party recover its loss from the carrier?

Carrier liability is determined independently under:

• the carriage contract;
• the bill of lading;
• the road consignment note;
• the air waybill;
• applicable national law;
• and international transportation conventions.

This can produce an important result.

A buyer may bear the risk vis-à-vis the seller but still have a strong claim against the carrier.

For example:

The buyer bears risk after the cargo is handed to the carrier.

The carrier then negligently damages the cargo.

The buyer may remain obliged to pay the seller under the sales contract but may recover the loss — subject to applicable limits and defences — from the carrier or its insurer.

13. International Road Transport and the CMR Convention

For international road transportation, the CMR Convention is particularly important.

UNECE explains that the Convention standardises carrier liability and contractual conditions for international carriage of goods by road where the relevant international criteria are satisfied.

Article 17 establishes the central principle that the carrier is liable for total or partial loss, damage and delay occurring between the time it takes over the goods and the time of delivery, subject to the Convention’s defences.

Possible defences may concern matters such as:

• fault of the claimant;
• instructions given by the person entitled to dispose of the goods;
• inherent defects of the goods;
• or circumstances which the carrier could not avoid and whose consequences it could not prevent.

The CMR system also limits compensation.

Under the 1978 Protocol, the general limit for cargo loss was converted to 8.33 Special Drawing Rights per kilogram of gross weight lost, subject to the Convention’s detailed rules and possible declarations of value or special interest.

This can create a major commercial surprise.

A truck may contain extremely valuable but lightweight cargo.

The cargo’s market value might be EUR 1 million, while the carrier’s treaty-based liability could be substantially lower.

Cargo insurance is therefore often indispensable.

14. Maritime Cargo Claims

Sea-carriage disputes involve a different legal architecture.

Depending upon the jurisdictions involved, bill of lading, ports of loading and discharge, and contractual incorporation, regimes derived from the Hague Rules, Hague-Visby Rules or other maritime cargo conventions may govern carrier liability.

Under the Hague-Visby framework, carriers owe significant obligations concerning the vessel and the care of cargo, while also benefiting from statutory defences, monetary limitations and procedural protections.

The Hague-Visby Rules remain embedded in the laws of important shipping jurisdictions. For example, the United Kingdom gives them force of law through the Carriage of Goods by Sea Act 1971.

Maritime claims can involve issues including:

• seaworthiness;
• improper stowage;
• container damage;
• water ingress;
• temperature deviation;
• negligent handling;
• fire;
• deck carriage;
• deviation;
• misdelivery;
• and release of cargo without presentation of an original bill of lading.

Time limits can be extremely short.

Cargo interests should therefore avoid assuming that ordinary national limitation periods necessarily apply.

Immediate legal review following discovery of maritime cargo damage is often essential.

15. Air Cargo and the Montreal Convention

International air cargo may fall under the Montreal Convention 1999.

ICAO describes the Convention as establishing a unified liability framework for international air cargo concerning loss, damage and delay.

Article 18 provides the basic principle that the carrier is liable for destruction, loss or damage to cargo where the event causing that damage occurred during carriage by air, subject to the Convention’s specified exclusions and conditions.

Article 19 separately addresses damage caused by delay and allows the carrier to avoid liability where it proves that all measures reasonably required to avoid the damage were taken or that taking such measures was impossible.

As with road and sea carriage, air-carrier liability may be subject to monetary limits.

ICAO increased the Montreal Convention liability limits with effect from 28 December 2024 as part of the Convention’s periodic inflation-adjustment mechanism.

For valuable cargo transported by air, reliance solely on carrier liability may therefore provide insufficient protection.

16. Multimodal Transportation Creates Additional Complexity

Modern shipments often involve several modes of transport.

A container may travel:

1. by truck from a factory to a port;
2. by sea to another country;
3. by rail to an inland terminal; and
4. by truck to the buyer’s warehouse.

If the container is opened at destination and the goods are damaged, a major factual question arises:

At which stage did the damage occur?

The answer can determine which liability regime applies.

If damage occurred during the road leg, CMR may become relevant.

If it occurred during ocean carriage, maritime rules may apply.

If the place of damage cannot be identified, the contractual multimodal liability regime and applicable national law become particularly important.

This is why evidence preservation is critical.

17. Cargo Inspection and Evidence

When damaged goods arrive, the commercial reaction is often to unload, clean, repair or dispose of them immediately.

From a litigation perspective, this can be dangerous.

Important evidence may disappear.

Businesses should consider preserving:

• photographs and videos;
• container seal numbers;
• packaging;
• temperature records;
• GPS data;
• loading records;
• warehouse reports;
• customs records;
• bills of lading;
• CMR consignment notes;
• air waybills;
• delivery receipts;
• surveyor reports;
• inspection certificates;
• correspondence with carriers;
• and evidence concerning the condition of goods before dispatch.

Where substantial cargo value is involved, an independent marine or cargo surveyor may be necessary.

The survey should attempt to identify not merely that the goods were damaged, but when, where and how the damage probably occurred.

18. Why the Delivery Receipt Matters

A signed delivery receipt stating that goods were received in apparent good condition can become significant evidence for the carrier.

For visible damage, the consignee should therefore avoid signing an unconditional clean receipt where the shipment is obviously damaged.

Appropriate reservations should be recorded.

Concealed damage presents greater difficulty.

Machinery inside apparently intact packaging may later prove broken.

Temperature-sensitive cargo may appear physically normal but have been exposed to unacceptable temperatures.

International transport regimes frequently contain specific notice periods for visible and concealed damage.

Failure to give timely notice may prejudice the cargo claimant’s evidentiary or substantive position.

Claims procedures should therefore begin immediately.

19. Cargo Insurance: Who Should Make the Claim?

Insurance is often the most commercially efficient route to recovery.

But the existence of cargo insurance raises several questions:

• Who is insured?
• When did cover attach?
• Which risks are covered?
• What exclusions apply?
• What is the insured value?
• Is there a deductible?
• Was packaging adequate?
• Was the carrier approved?
• Were storage and transshipment covered?
• Was notice given in time?

Under CIF and CIP, the seller has an Incoterms® obligation to arrange insurance at the prescribed level, but the commercial purpose of that insurance is connected to the party bearing transportation risk.

Under other Incoterms® rules, there may be no obligation on either party to arrange insurance even though one of them bears substantial transportation risk.

This creates a dangerous insurance gap.

The sales contract should therefore address cargo insurance expressly rather than assuming that the Incoterms® term resolves every insurance issue.

20. Subrogation: The Insurer May Sue the Carrier

Where an insurer compensates the insured cargo interest, the insurer may acquire subrogation rights allowing it to pursue the party legally responsible for the damage.

A typical structure may therefore be:

Buyer suffers cargo loss → cargo insurer pays buyer → insurer pursues carrier.

This explains why shipping disputes often continue even after the commercial buyer has received compensation.

The real litigation may subsequently occur between the insurer and the carrier.

Proper preservation of recourse rights is therefore important even when an insurance claim is expected to be paid.

21. Force Majeure Does Not Automatically Decide Risk

International shipments may be disrupted by:

• war;
• port closures;
• sanctions;
• natural disasters;
• strikes;
• embargoes;
• canal closures;
• piracy;
• cyberattacks;
• or government restrictions.

Businesses often immediately invoke “force majeure.”

But force majeure and risk allocation are separate concepts.

A force majeure clause may excuse contractual non-performance in particular circumstances.

It does not necessarily determine which party bears the physical loss of goods that have already entered transportation.

That question may still depend upon:

• the Incoterms® rule;
• CISG provisions;
• the carriage contract;
• and applicable transport law.

The contract must therefore be read as an integrated whole.

22. Ownership of the Goods Is Different From Risk

Another common misconception is:

“Whoever owns the goods bears the risk.”

International sales law does not necessarily operate that way.

Legal title and risk can pass at different times.

The CISG itself does not govern the effect of the sale contract on property rights in the goods. UNCITRAL expressly identifies the effect of the contract on ownership as a matter outside the Convention’s scope.

A contract could therefore provide that:

• ownership remains with the seller until full payment;
• while transportation risk passes to the buyer when goods are handed to the carrier.

This situation is commercially common.

Risk analysis should therefore never be based solely on ownership.

23. Payment by Letter of Credit Does Not Determine Cargo Risk Either

International sales are frequently financed through documentary credits.

Banks examine documents rather than physically examining cargo.

A complying bill of lading, invoice and certificate may trigger payment even where the underlying goods are subsequently discovered to have been damaged.

The documentary payment system and transportation-risk system therefore operate independently.

A buyer may be required to honour or reimburse a documentary payment while separately pursuing:

• the seller;
• carrier;
• insurer;
• surveyor;
• or other responsible party.

Careful coordination between the sale contract, Incoterms®, letter of credit and transport documents is therefore essential.

24. A Practical Example: China to Türkiye

Consider a Turkish company purchasing industrial equipment from a Chinese manufacturer.

The contract states:

CIP Istanbul Airport, Türkiye – Incoterms® 2020

The Chinese seller hands the properly packaged equipment to the contracted carrier in Shanghai and arranges transportation and insurance to Istanbul.

The cargo is severely damaged during transit.

The Turkish buyer may initially assume that the Chinese seller must replace the goods because the seller organised the transportation.

But under CIP, transportation risk generally passes when the goods are handed over to the carrier.

The buyer may therefore need to pursue the benefit of the cargo insurance and potentially preserve claims against the carrier.

The result could be completely different if the contract stated:

DAP Buyer’s Warehouse, Istanbul – Incoterms® 2020.

Under DAP, the seller would generally retain transportation risk until delivery at the named destination.

A single three-letter trade term can therefore change the economic allocation of a major cargo loss.

25. A Second Example: Goods Stuck in Turkish Customs

Assume a German manufacturer sells machinery to a Turkish buyer under:

DAP Istanbul, Türkiye – Incoterms® 2020.

The machinery reaches Turkish customs but cannot be released because the Turkish importer has failed to obtain a legally required import authorisation.

Under DAP, import clearance is ordinarily the buyer’s responsibility.

Storage and delay consequences may therefore fall substantially on the buyer, depending on the contract and cause of the problem.

Now change the contract to:

DDP Istanbul, Türkiye – Incoterms® 2020.

The legal position changes materially because the seller has assumed responsibility for import clearance.

This is why foreign sellers should be cautious when agreeing to DDP in jurisdictions where they may not legally or practically be able to act as importer of record.

The ICC itself warns that local law in the destination country may make DDP difficult or inappropriate for a foreign seller.

26. Contract Drafting: How Can Shipping Disputes Be Prevented?

A sophisticated international sales agreement should not merely state the product and price.

It should clearly address:

Delivery term

The exact Incoterms® rule, named location and version should be stated.

Packaging

The contract should define required packaging standards, particularly for fragile, hazardous, temperature-sensitive or high-value goods.

Inspection

The parties should determine when inspection occurs and whether independent pre-shipment inspection is required.

Transportation documents

Required bills of lading, CMR notes, air waybills, certificates of origin and customs documents should be identified.

Insurance

The policy holder, insured value, scope of cover and beneficiary should be clear.

Customs responsibility

Responsibility for export and import permits, licences, duties and certificates should be expressly allocated.

Delay

The consequences of late delivery should be specified.

Notification

Cargo-damage notification procedures should be coordinated with the applicable transport convention.

Limitation of liability

Contractual limitations should be reviewed against mandatory transport-law regimes.

Governing law

The applicable law should be selected.

CISG

The parties should decide whether the CISG applies or is expressly excluded.

Dispute resolution

The agreement should determine whether disputes will be resolved by national courts or international arbitration.

27. Litigation or International Arbitration?

Cross-border cargo disputes can involve several defendants located in different countries.

The seller may be in China.

The buyer may be in Türkiye.

The carrier may be German.

The shipping line may be incorporated in Denmark.

The insurer may be based in London.

The damaged cargo may have been discovered in Istanbul.

This makes jurisdiction and dispute-resolution clauses critically important.

International sales contracts frequently use arbitration under institutional rules such as:

• ICC;
• LCIA;
• SIAC;
• HKIAC;
• ISTAC;
• or other agreed institutions.

Transport documents may contain entirely different jurisdiction or arbitration clauses.

A bill of lading may require disputes against the sea carrier to be litigated or arbitrated in a jurisdiction different from the forum selected in the sales contract.

Accordingly, a single cargo incident can generate several parallel legal relationships and potentially several forums.

The dispute strategy should therefore identify each potential claim separately.

28. The Correct Legal Analysis

When goods are lost, damaged or detained during international transportation, the dispute should normally be analysed in the following sequence:

First: What does the sales contract say?

Second: Which Incoterms® rule applies?

Third: At what exact point did the risk pass?

Fourth: When and where did the damage occur?

Fifth: Was the loss accidental, or was it caused by a contractual breach?

Sixth: Which carrier had custody of the cargo at the relevant time?

Seventh: Which international carriage convention or national transport law applies?

Eighth: Is the carrier entitled to a limitation of liability?

Ninth: What cargo insurance exists?

Tenth: Have notification and limitation deadlines been protected?

This method prevents one of the most common errors in international trade disputes: attempting to determine liability simply by asking who physically possessed the goods when the problem was discovered.

Conclusion

International shipping disputes are rarely resolved by identifying a single party responsible for everything that happens during transportation.

The legal structure is more complex.

The sales contract determines the commercial obligations between seller and buyer.

Incoterms® 2020 can establish where delivery occurs, when transportation risk changes hands and who bears particular logistics and customs responsibilities. The ICC’s current rules comprise eleven internationally recognised trade terms designed precisely to clarify these allocations.

The CISG may provide the underlying law governing an international sale, including default rules concerning passing of risk. Türkiye has been a CISG Contracting State since 2011.

Separately, the carrier’s liability may be governed by international transportation regimes such as the CMR Convention for international road carriage, maritime cargo rules for carriage by sea, or the Montreal Convention for international air cargo.

Finally, cargo insurance may determine who ultimately absorbs the financial loss even where another party was legally responsible for causing it.

For international businesses, the central practical lesson is therefore simple:

Do not ask only who arranged transportation. Ask when risk passed, who caused the loss, which transport regime applies and whether the loss was insured.

These are four different questions.

A properly structured international sale should therefore coordinate:

the sales contract + Incoterms® + transportation contract + insurance policy + customs obligations + dispute-resolution clause.

When these documents are drafted independently without considering how they interact, a cargo worth millions of dollars can be lost while the seller, buyer, carrier and insurer each argue that another party bears responsibility.

When they are properly coordinated, the legal consequences of loss, damage, customs detention and delay become substantially more predictable.

This article is prepared for general informational purposes concerning international sale of goods, transportation law and international trade. It does not constitute legal advice. The applicable rules depend on the sales contract, selected Incoterms® rule, countries involved, transportation method, applicable international conventions, transport documents, insurance policy and circumstances in which the loss or damage occurred.