ICPO, LOI, FCO, SPA, NCNDA and POP: What Each Document Does

There is no universal commodity-document sequence. These labels are commercial shorthand, not a single rulebook. Their legal effect depends on the text, governing law, signatures, authority, and surrounding transaction.

LOI: letter of intent

An LOI usually expresses a buyer’s current interest and the commercial requirement. It should identify the buyer entity, product, specification, quantity, destination, delivery window, preferred Incoterm, and proposed payment approach.

An LOI should say which provisions, if any, are intended to bind. A vague LOI from an undisclosed buyer proves very little.

ICPO: irrevocable corporate purchase order

The name sounds stronger than an LOI, but the heading does not make the document irrevocable or bankable. The issuing entity, signatory authority, commercial completeness, conditions, and governing law matter more than the acronym.

Do not treat an ICPO as proof of funds, bank approval, or a binding sale contract unless the document and applicable law actually support that conclusion.

FCO: full corporate offer

An FCO commonly presents seller-side terms after a requirement has been reviewed. It should identify the legal seller or authorized issuing party, product, specification, quantity, origin, delivery basis, price validity, inspection, documents, payment procedure, and conditions.

An FCO is not proof of product. It is a commercial offer whose authority and feasibility still require verification.

SPA: sale and purchase agreement

The SPA is the transaction contract. It should reconcile the product, quantity, tolerance, price, Incoterm, named ports, schedule, inspection, documents, payment, default, claims, force majeure, law, dispute process, and signatory authority.

ICC Incoterms rules can allocate delivery obligations, risk, and costs when incorporated correctly. They do not replace the SPA and do not determine payment, title, breach remedies, or every port charge.

NCNDA: non-circumvention and non-disclosure agreement

An NCNDA can protect confidential introductions and restricted information. It should define the protected parties, introduced principals, confidential information, permitted disclosure, duration, exclusions, remedies, law, and signatures.

It cannot turn an unauthorized intermediary into a seller mandate. It also should not block necessary disclosure to banks, insurers, inspectors, lawyers, regulators, or logistics parties when the transaction requires it.

POP: proof of product

POP is not one standard document. Depending on the stage, it can refer to producer authority, inventory evidence, warehouse evidence, a recent lot COA, terminal evidence, allocation, or bank-channel documents.

Sending an old COA or warehouse photo is not proof of current control. Evidence should be attributable, current, proportionate to the stage, and verified through an independent route where possible.

A defensible working sequence

A practical sequence is:

1. establish counterparty identity and authority;
2. exchange a coherent requirement or offer;
3. protect necessary confidential introductions;
4. reconcile commercial terms;
5. verify stage-appropriate product and buyer evidence;
6. negotiate and sign the SPA;
7. complete bank, compliance, inspection, and logistics conditions.

Real transactions can vary. The control is not acronym order. The control is whether each new obligation is supported by the evidence required at that stage.

Is an LOI legally binding?

It depends on the text and applicable law. Many commercial LOIs state that the proposed purchase is non-binding while making confidentiality, governing-law or exclusivity clauses binding. The title alone does not answer the question.

Does an ICPO prove funds?

No. It can show that a company issued a purchase instruction, but proof of funds or bank readiness requires separate evidence and bank review. A document cannot create authority that its signatory does not have.

When should POP move?

Sensitive product evidence should move after both parties pass identity and authority checks and the requirement is coherent. The buyer qualification page and supplier qualification page show the two files that need to converge before a named introduction.

Sources and review record

These are the primary or authoritative sources used for this explainer. Listing a source does not imply endorsement of GMC.

1. Incoterms and commercial contracts International Chamber of Commerce · reviewed August 26, 2026
2. When you are planning to go to market Canadian Trade Commissioner Service · reviewed August 26, 2026