Confused About Payment Terms? What Do PDC, Duty Exempted Order, and Exworks Mean?

I received a project in which the payment terms are mentioned as 45 days PDC. But I don't know what the meaning of PDC is. Please also tell me what the meaning of a Duty Exempted Order and Exworks is.

Understanding PDC, Duty-Exempted Orders, and Ex-Works

PDC stands for Post-Dated Cheque, which means you receive the payment with a future date than when the payment is due. This is usually adopted by companies when they either have a funds crunch or when they want to postpone their cash outflow to a later date. You can encash the cheque only AFTER the date mentioned on the cheque. A 45-day PDC means 45 days AFTER the delivery or payment becomes due.

Duty-Exempted Order

A Duty-Exempted Order is usually given by government-related organizations/departments or government-related orders released by private entities since such orders have exemptions as per law.

Ex-Works

Ex-Works means the pricing is calculated when the material/order LEAVES the Works/Factory. Therefore, transport costs, transit insurance, and such costs are EXTRA.

Hope this helps.

Regards,
TS

Dear Friend, I understood the meaning of a Post-Dated Cheque, but I could not understand what you mentioned about Ex-works and duty-exempted. Could you explain more?