Incoterms: DDP – Delivered Duty Paid

Incoterms 2000 7 comments

DDP

DDP – Delivered Duty Paid – is another useful incoterm that can be used with any mode of transport.
It is very similar to DDU except that with DDP the seller is also responsible for all import customs formalities and duty and for final delivery of the goods to the buyer at the named place of destination. Basically, with DDP, the buyer carries no risk or responsiblity for the goods until they have been made available to him at the named place of destination, which is normally the buyer’s/importer’s premises.

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, including final delivery, 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. Also should advise buyer when delivery will be made.
6) Seller must make all arrangements for import customs formalities and payment of customs duty.

Buyer’s Responsibilities:

1) Buyer must pay for the goods as per the sales contract
2) Buyer must provide seller with all licenses and authorizations required for import clearance and formalities.
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 only costs applicable after the goods have been delivered by the seller to 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.

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 2010″. For a complete and official overview please refer to the ICC’s publication.

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  • Irshad Siraaj August 27, 2009, 4:29 am

    When it comes to insuarence coverage, you have mentioned as DDU in this also, is it a typing error? Is DDP covered under insuarence ?

  • paul September 2, 2009, 3:06 am

    does it make sense to negotiate between DDP & DDU for intra-community (EU) purchases?

  • Joneil November 3, 2009, 6:47 am

    For DDU transaction where sale of goods require quality adjustments on price and quantity, can it be that the basis of quality determination is from the samples taken at the loading port?

  • Hauxstable November 28, 2009, 11:00 pm

    Most shipment we receive on DDU incoterms are always accompanied by customs exoneration documents and/or commodities of no commercial vaue even when they are shipped on DDP incoterms,hence it all depends on the circumstances and country in question.

  • Cecilia Garcia April 4, 2011, 6:57 am

    Very interesting article. I need to know if in case of DDP the local taxes are paid by exporter or only import duty taxes?? because here in Brazil, besides import duties we have ICMS, PIS, COFINS, IPI, all local taxes, all after nationalization; all of them have to be paid by exporter???

  • LASCO KUSARE August 13, 2013, 6:12 am

    HOW DID SHIPPING DOCUMENTS SHOULD READ ON CONSIGNEE NAME IN BILL OF LADING IN DDP TERMS

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