What is DDP?
Under the Delivered Duty Paid (DDP) Incoterm rules, the seller assumes total responsibility and costs for delivering the goods to any given destination. DDP prompts that the buyer is free of any risk or cost until the goods are unloaded from the vehicle at the destination.
This Incoterm places the highest responsibility on the seller and the lowest responsibility on the buyer. Nonetheless, the seller is not responsible for unloading the contents of the container or load. It’s important to note that under DDP terms, there is a higher risk of delays and unforeseen expenses.
According to the DDP Incoterm, what’s expected of the seller?
The seller is responsible for clearing customs, paying duties and taxes, and arranging all necessary registrations. The seller generally acts as a foreign importer of record at the destination country and therefore should have a detailed understanding of the import rules and regulations in that country.
The risks to the seller also include VAT (value-added tax) charges, bribery, and storage costs if unexpected delays occur. The seller must arrange all transportation and associated costs, including export clearance and customs documentation required to reach the destination port.