What do Incoterms primarily establish in international shipping?

Incoterms, or International Commercial Terms, are a set of predefined rules published by the International Chamber of Commerce (ICC) that are widely recognized and used in international shipping. They primarily define the responsibilities of buyers and sellers in the process of transporting goods across international borders.

The correct answer emphasizes the fact that Incoterms specify the obligations each party has concerning shipping and handling. This includes details such as who is responsible for paying for transportation, insurance, and tariffs, as well as who assumes risks at different points during the shipping process. By establishing these responsibilities, Incoterms help prevent misunderstandings and disputes between buyers and sellers by clarifying the terms of delivery and risk transfer.

In contrast, the other options fall short of capturing the essence of what Incoterms address. They do not primarily relate to specific pricing agreements, container sizes, or modes of transportation, which can be determined separately by the parties involved based on their needs, agreements, and logistical considerations. Incoterms focus particularly on the roles and responsibilities tied to the shipment and delivery of goods, making them essential for facilitating international trade.