Incoterms: DDU – Delivery Duty Unpaid

DDU – Delivery Duty Unpaid – Is a fairly common incoterm and can be used for any mode of transport. Under DDU terms the seller is responsible for making the goods available to the buyer at a named place of destination but not cleared for import. The seller is also responsible for all the costs involved to deliver the goods to the named place of destination. The seller’s risk also does not end until it reaches the names place of destination.

A common misconception with DDU is that the seller is also responsible for the inland transport of the goods to their final destination after the buyer has arranged for import clearance. This is incorrect. The buyer assumes all risk and responsibility for the import clearance, duties, and delivery to final destination.

Under DDU terms the seller’s risk and responsiblity end once the goods have been made available to the buyer at the named place of destination. The seller is also responsible for all costs up to the named place of destination, but is not responsible for delivering the goods to their final destination.

Seller’s responsibilities:
1) Produces the goods and commercial documents as required by the sales contract.
2) Arranges for export clearance and all export formalities.
3) Arranges and pays for all costs for the transportation of the goods up to named place of destination.
4) Assumes all risk to the goods (loss or damage) up to the point they have been made available to the buyer at the named place of destination. SPECIAL NOTE: Under DDU terms the seller is under no obligation to provide insurance. However, he may have a vested interest in the goods during the voyage. It may be a wise decision to purchase additional insurance coverage in the case of a loss.
5) Seller must advise the buyer that the goods have been delivered to the carrier and the appropriate arrival information.
6) Seller has to provide the buyer with transport documents that will allow the buyer to take possession of the goods at the named place of destination.

Buyer’s Responsibilities:
1) Buyer must pay for the goods as per the sales contract
2) Buyer must obtain all commercial documentation, licenses, and authorizations required for import and arrange for import clearance and formalities at own risk and cost.
3) Buyer takes delivery of the goods after they have been delivered by the seller to the named place of destination.
4) Buyer must assume all risks for the goods from the time the goods have been made available at the named place of destination.
5) Buyer pays for all costs of transportation, import customs formalities and duty fees, and all other formalities and charges related to the transportation of the shipment from the time the goods have been made available at the named place of destination.
6) Buyer would accept the seller’s transport documents provided they conform with the sales contract and will allow the buyer to take possession of the goods after delivery to the named place of destination.

Did you find this post useful? Then check out our complete overview of Incoterms 2000.

This interpretation is provided as a guide only.

Incoterms are published by the International Chamber of Commerce and are available on their website and official publication “Incoterms 2000″. For a complete and official overview please refer to the ICC’s publication.

Learning to cope with congestion and cargo growth

One of the results of the growth in international trade has been an increase in the volume of cargo being handled at ports and major metropolitan areas around the U.S. As ports and related logistics infrastructure struggle to keep up with the growth in cargo, some areas are taking a proactive approach in coping with current conditions and planning for future cargo growth. The Philadelphia Inquirer earlier this week discussed some of the challenges and issues that area planners are dealing with:

“A lot of experts are saying the volume of cargo here will double by 2020,” said Theodore K. Dahlburg, freight planning manager at the Delaware Valley Regional Planning Commission.

With 100 million people living within a one-day drive of Philadelphia, transportation and logistics services are widely recognized as important to economic-growth and job-creation opportunities. So preparing for growth is critical to the region’s prosperity.
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“Distribution sites are getting bigger,” said Carl Gersbach, a Berwyn-based managing director for the C.B. Richard Ellis Inc. real estate firm. “There is a tremendous challenge ahead for the U.S. to handle the amount of imports. All of this stuff has to be put somewhere before its gets distributed.”

The nation’s seaports and distribution centers “are not growing as fast as imports,” he said.

To help prepare, 50 planners from the regional planning commission as well as state and local governments visited truck stops, distribution centers, seaport terminals and rail yards.
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Some parts of the growing problem were obvious right away, Dahlburg said.

There are, for example, far too few places for big trucks to park.

Dahlburg and colleague Scott Brady visited every truck stop and rest area in Southeastern Pennsylvania and South Jersey.

Every place they visited was overflowing and many trucks were parked in risky places along roadways. The problem is getting more serious because new limits on the hours that truckers can drive in a day are being strictly enforced, forcing drivers to park wherever they can when time runs out.

And there are too few signs directing big trucks. When a big truck gets lost it can cause problems. “It is hard for a truck pulling a 53-foot trailer to turn around,” Dahlburg said.

The planners also discovered fresh evidence of a problem that has long bedeviled many neighborhoods: the local roads that link major highways with distribution terminals. “We force freight to drop off the interstates and meander through neighborhoods,” Dahlburg said.

These are problems that every major port/logistics area need to confront and assess. They are problems that have long plagued the Long Beach/Los Angeles area for years and they aren’t going to go away, they will only get larger. It appears planners in the Philadelphia area are taking the right approach, learning what the issues are and investigating solutions. Cooperation between states and localities will also be important as regions served by major logistics points work to improve infrastructure and ease congestion. It’s also noteworthy that cities are beginning to realize the economic impact of transportation and logistics, especially from a job-creation standpoint.

Airline Fuel Surcharge to Decrease

Look for a reduction of the fuel surcharge to take effect during the next couple of weeks. Many airlines have announced that the charge will decrease from $0.60 to $0.55 per kilo.

Cargolux, the big all-cargo airline based in Luxembourg, was the first to announce the change in the wake of sharp and sustained declines in jet fuel costs in recent weeks. The average spot price for jet fuel in Rotterdam, the largest European market, was $2.187 at the end of August and fell to $1.825 within the next two weeks. Cargolux will trim its fuel fee to 55 euro cents per kilogram or its equivalent in local currency, from 60 cents now, effective Oct. 10.

The charge is based on actual weight and will be implemented across the Cargolux network, according to local legislation and wherever it is legally permitted, the company said. – via aircargoworld.com

Many airlines typically follow suit once a few airlines have announced a reduction.

Quick facts on Bangkok’s new international airport

Ok, so it has been on the drawing board since the ‘60s and its official opening day was delayed for several years, but it appears from these quick facts that it was well worth the wait and Thailand has done a pretty good job designing the airport so that they will continue to be competitive in the years to come.

• The airport will initially serve 45 million passengers annually, with capacity expected to more than double once it becomes fully operational.
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• Suvarnabhumi’s seven-floor passenger terminal has 563,000 square meters (six million square feet) of floor space, about 10,000 square meters more than Hong Kong’s Chek Lap Kok airport. Its 132-meter (433-foot) high control tower is the tallest in the world, beating Kuala Lumpur International Airport’s by 10 meters.
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• Planes use two runways, one that is 3,700 meters long and the other 4,000 meters long. A third runway is under construction, with plans in place to eventually build a fourth.

• The airport can handle 76 flights an hour and service 90 airlines.

• Passengers can check in at a total of 460 counters, while there are 22 kilometers (13.5 miles) of conveyor belts to handle the tons of luggage tran¬siting each day.
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• The airport’s cargo storage center can handle up to three million tons a year, a figure expected to rise to 6.4 million tons annually once completed.
• The aircraft maintenance center, at 24,300 square meters, is the largest in Asia.

It is obvious from these figures that Thailand plans on being the major air hub for S.E. Asia for years to come.

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