DDP

What Is DDP (Delivered Duty Paid) in Incoterms® 2020?

DDP (Delivered Duty Paid) is one of the most comprehensive terms defined under Incoterms® 2020, published by the International Chamber of Commerce (ICC). Under DDP, the seller assumes maximum responsibility—covering all costs and risks to deliver the goods, already cleared for import, to a named place in the buyer's country. The buyer’s obligations are minimal, essentially just receiving the goods.

Seller’s Responsibilities

• Delivery of Goods: Ensure goods arrive at the agreed location in the buyer’s country, according to contract specifications (quality, quantity, timing).
• Packaging and Marking: Properly pack and mark the goods suitable for international transit, as required.
• Loading and Inland Transport: Arrange and pay for all pre-carriage, loading, and inland transportation, from the seller’s facility to place of delivery.
• Main Carriage: Book, pay, and manage international freight, whether by sea, air, rail, or land.
• Export and Import Clearance: Complete all necessary export formalities in the seller’s country and import customs clearance in the buyer’s country, including the payment of all customs duties, VAT, and taxes.
• Insurance: While not mandatory, sellers often arrange insurance due to full control of the supply chain.
• Delivery Risks: Bear all risks and costs up to the point the goods are made available, ready for unloading, at the named destination.
• Documentation: Provide all documents necessary for export, import, and delivery (commercial invoice, transport documents, import/export permits, etc.)
• Notification: Inform the buyer when goods are delivered at the destination and ready for receipt.

Buyer’s Responsibilities

• Receipt of Goods: Take delivery of the goods at the final agreed-upon location.
• Unloading: Responsible for unloading the goods from the arriving vehicle, unless contractually agreed otherwise.

DDP Responsibilities Table

Key Notes

• Best for inexperienced buyers: DDP is ideal for buyers who lack experience with international logistics, as the seller handles the entire process, including all taxes and customs in the destination country.
• Risks for sellers: Sellers may face local regulatory hurdles and unexpected costs in the destination country. It requires deep knowledge of customs procedures and reliable partners in the buyer’s market.
• Highly convenient, but potentially risky: Any delays in customs or incomplete paperwork are the responsibility of the seller under DDP.

Incoterms 2020: Core Points Comparison Table

Term	Applicable Mode of Transport	Point of Risk Transfer	Seller's Responsibility	Buyer's Responsibility
EXW	Any mode	Upon delivery at seller’s premises	Only makes goods available; not responsible for transportation, clearance, or insurance	Responsible for all transportation, clearance, insurance costs, and risks
FCA	Any mode	Upon delivery to the carrier	Handles export clearance, delivers goods to carrier	Arranges transportation, pays all subsequent charges, assumes risk
CPT	Any mode	Upon delivery to the first carrier	Pays carriage to named destination, handles export clearance	Responsible for unloading at destination, import clearance, insurance costs, and risks
CIP	Any mode	Upon delivery to the first carrier	Pays carriage and insurance to named destination, handles export clearance	Responsible for unloading at destination, import clearance, assumes remaining risks
DAP	Any mode	Upon delivery at destination (not unloaded)	Bears costs and risks to the named destination, not responsible for unloading	Responsible for unloading, import clearance, and all related costs and risks
DPU	Any mode	After unloading at destination	Bears costs and risks for transportation and unloading at destination	Responsible for import clearance costs and risks
DDP	Any mode	Upon delivery at destination (duty paid)	Bears all costs (including import duties and taxes) and risks	Only needs to receive the goods
FOB	Sea / Inland waterway	When goods are loaded on board the vessel	Handles export clearance, pays loading charges	Arranges main carriage, pays freight and insurance, assumes risk post-loading
CFR	Sea / Inland waterway	When goods are loaded on board the vessel	Pays carriage to port of destination, handles export clearance	Handles insurance, import clearance, assumes risk after loading
CIF	Sea / Inland waterway	When goods are loaded on board the vessel	Pays carriage and insurance to destination port, handles export clearance	Responsible for import clearance, assumes risk after loading

Source: ICC Incoterms® 2020 – DDP Rule