How is the new tariff environment been impacting your business? Reviewing supply contracts, adjusting insurance coverage limits, and business continuity planning can be essential to keeping operations running smoothly.
Supply Contracts
Incoterms®
Incoterms® are a set of 11 internationally recognized rules which define the responsibilities of sellers and buyers. Incoterms® specify who is responsible for paying for and managing the shipment, insurance, documentation, customs clearance, and other logistical activities.
Common Cannabis Incoterms®
Ex Works (EXW)
Seller makes the goods available at their premises. Buyer is responsible for all costs and risks involved in taking the goods from the seller’s premises to the desired destination.
Delivered At Place (DAP)
Seller delivers when the goods are placed at the disposal of the buyer on the arriving means of transport, ready for unloading at the named place of destination.
Delivery Duty Paid (DDP)
Seller is responsible for delivering the goods to the named place in the country of the buyer, including all costs and risks of carrying out customs formalities and paying duties and taxes.
Note: Can be important to clarify if tariffs are included as duties.
Payment Terms
Payment terms need to factor in the regulatory complexities and timing for the cannabis supply chain, especially when exporting, to ensure that transactions are compliant with international rules.
Insuring the Supply Chain
When evaluating insurance coverage, it’s essential to consider some of the following basics:
• CARM Bonds
• Stock Throughput Insurance
• Traditional Cargo Insurance
• Business Interruption Insurance
• Credit Risk Insurance
The BFL CANADA Advantage
In the fast-evolving cannabis industry, navigating risks and regulations is crucial. BFL CANADA offers tailored insurance solutions and expertise, representing businesses across the supply chain. With a deep understanding of cannabis specific challenges, BFL CANADA ensures comprehensive coverage and proactive support.
About the Author
Brayden has over a decade of commercial insurance experience, including specializing in cannabis and life sciences. As a former in-house Insurance and Risk Manager at Aurora Cannabis, he brings unique insights into industry challenges and opportunities.
For more information please contact:
Brayden York, RIMS-CRMP, CAIB, B.Comm | Vice President, Client Executive | T. 306-241-3010 | E. byork@bflcanada.ca
Disclaimer: This article is provided for informational purposes only and does not guarantee future results. Incoterms® and Insurance coverage terms and conditions vary by policy, country, and region. Readers should always seek advice from a licensed professional before changing coverage or purchasing insurance.
