CPT (Carriage Paid To)

CPT is the simplest of the C-rules. The seller arranges and pays for carriage all the way to the named destination, but — as with all C-rules — the risk transfers far earlier. Specifically, risk passes to the buyer the instant the goods are handed to the first carrier. From that point on, even though the seller is still paying the freight, the buyer bears the risk of loss or damage.

There is no insurance requirement under CPT. This is the one feature that distinguishes it from its sibling CIP. Under CIP the seller must buy comprehensive insurance for the buyer; under CPT neither party is contractually obliged to insure the goods. That leaves an exposure: the buyer carries the risk during the main carriage with no mandated cover, so a prudent buyer should arrange its own insurance.

On reaching the destination, the buyer is responsible for import customs clearance, duties and import VAT. CPT, like the other C-rules, does not cover destination import charges.

CPT and CIP are identical except for insurance. Both pass risk at the first carrier and both have the seller pay carriage to the destination — but only CIP requires the seller to buy (comprehensive) insurance. If insurance protection matters to the buyer, CIP is the safer choice; if the buyer prefers to arrange its own cover, CPT is appropriate.

CPT also relates closely to FCA. Under FCA the buyer pays the main carriage; under CPT the seller pays it. The risk transfer point is similar — at handover to the carrier — but the cost responsibility for the main leg differs. So you can think of CPT as 'FCA plus the seller pays freight to destination'. For sea freight specifically, CPT's equivalent is CFR, and CIP's equivalent is CIF.