Meet our writer. Written by our resident freight forwarding and shipping expert. Bob Ronai→
Delivery is identical to that in the Delivery at Place (DAP) Incoterms® 2020 Rules.
The danger of Delivery Duty Paid (DDP) is in the requirement that the SELLER must import clear.
Most, but not all, countries only allow local entities to import. That means in those countries the seller would need to be a legal entity in that country and registered for VAT/GST.
As you can imagine, if the seller takes on all the importing responsibilities, they will build the costs plus a hefty margin into their selling price.
Sometimes for DDP the import customs broker takes the easy way out and declares the buyer as the importer, without knowledge of, or approval from, that buyer.
In countries that do allow overseas entities to be the importer, be very, very careful. Local legislation may well allow Customs to claim any shortage of duty/taxes from a local entity such as the DDP buyer, customs broker, forwarder or banker.
For many reasons, DDP is best avoided.
Want to find out more about Incoterms® Rules 2020?
We have summarised the 11 Incoterms which have recently been revised by the ICC Incoterms Drafting Committee for 2020.
View our Incoterms® Rules 2020 hub here with free guides, podcasts, videos and content!
