DDP is the Incoterms® rule with the most obligations for the seller. The seller carries the costs and risk up to the agreed destination. For example, the land border, port, or airport in the destination country. The seller arranges and carries costs not only for export, but also for import.
Seller arranges and pays for:
- Transport to the agreed destination. For example, land border, inland port, seaport, or airport in the destination country.
- Export formalities and documents.
- Import formalities and local import documents.
Buyer arranges and pays for:
- Transport from the agreed destination location to final destination.
- Unloading at the agreed location.
Suitable for:
- Sellers willing and able to take on import formalities and taxes in the destination country.
- All forms of transport (rail, air, road, water).
- Payment by Letter of Credit or documentary collection.
Not or less suitable for:
- DDP is usually not advised because of rules in the destination country.
Transfer of risk from seller to buyer:
- Once seller transfers the goods, not yet unloaded, to buyer at the agreed destination location.
Points of attention:
- Sellers need to find out in advance whether they can comply with rules in the destination country.
- DAP is an alternative to DDP. With DAP, the seller is not responsible for import into the destination country.
- Agree upon the exact place at the destination location.