Electronic commerce is doing business via electronic networks. Paper-based trade documents such as, for example, request for quotation, purchase order or invoice are replaced by electronic messages, in particular Electronic Data Interchange (EDI) messages. These electronic messages are not only transmitted much faster than paper-based documents, but they can also be processed automatically by computers. An example of this automated processing of electronic messages is electronic contracting and negotiation where the actual trade contract is on-line negotiated and concluded via an electronic network. We present the legal expert system INCAS that can provide on-line explanations about the use of Incoterms in trade contracts. Incoterms stipulate which party (buyer or seller) is responsible for arranging and paying transport of the goods, and arranging the documents necessary for this transport (e.g. export and import clearance documents, certification of origin, quality certificates etc.). INCAS is implemented in the programming language Prolog. We also explain how the defeasible reasoning capability of Prolog is essential for modelling the reasoning about the Incoterms.