Under EXW (Ex-works) terms, when is the risk transferred to the buyer?

The answer is based on the fundamental principles of Incoterms, which dictate the responsibilities and risks associated with the transaction between seller and buyer. Under EXW (Ex-works) terms, the risk is transferred to the buyer when the goods are made available for pickup at the seller's premises. This means that as soon as the goods are ready and the buyer is notified, the responsibility for the goods, including any risks associated with their transport, lies with the buyer.

This is significant because it indicates that the seller's obligations are minimized under these terms. The seller’s duty mainly consists of providing the goods and ensuring they are available for collection. Once the goods leave the seller's site, the buyer then has to manage the remainder of the logistics, including transport, customs clearance, and any associated risks.

In contrast, the other options describe scenarios that do not align with the EXW terms. For instance, payment does not inherently affect the transfer of risks, nor does the arrival of goods at the destination or customs clearance, as these events occur later in the logistics chain after the transfer of risk has already taken place.