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Contracts · 12 August 2026

The buyer hasn't paid and the goods are in their warehouse. Who owns them?

Incoterms govern costs, delivery and risk. They don't govern title. And that difference decides whether non-payment leaves you with a claim or a thing.

The buyer hasn’t paid. The goods are already in their warehouse.

Who owns them?

Most people look for the answer in the Incoterm. It isn’t there.

Incoterms govern which costs and obligations each party bears, where delivery happens and when risk passes. They don’t govern title. Nor does the CISG: Article 4 expressly excludes that issue from its scope.

The answer depends on the applicable law and on what was agreed.

What gets misread most

In many legal systems, once there is a contract and delivery, ownership has already passed to the buyer. Even if they have not paid.

Non-payment does not automatically mean the goods remain your property. It creates a breach, not a property right.

Two different clocks

Take an FOB sale. Risk passes to the buyer once the goods are loaded on board. Title may pass before, after or at that same instant.

Two different clocks. They rarely show the same time.

That difference may determine whether, facing non-payment, you hold only a monetary claim or may attempt to reclaim the goods.

Retention of title

This is why retention of title isn’t paperwork. It may prevent title from passing until full payment.

May: its effectiveness against creditors depends on the country, how it was agreed and whether the goods remain identifiable.

Choosing the right Incoterm tells you who bears costs and risk. It doesn’t tell you who owns the goods.

Written by Eduardo Tena. Also published on LinkedIn.

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