DDP — Delivered Duty Paid

The seller is responsible for import customs clearance, including filing the customs declaration, paying import duties and VAT, and acting as (or appointing) the importer of record. The seller must either be registered as an importer in the destination country or appoint a customs broker who can clear goods on their behalf.

Not always. Some countries require the importer of record to be a locally registered entity. For example, Brazil requires a CNPJ (local tax ID) to import. In these cases, sellers shipping DDP must appoint a local customs broker or have a local subsidiary. This is a critical check before agreeing DDP terms for new destination countries.

For e-commerce shipments to the EU valued at €150 or less, sellers can register for the EU IOSS scheme and collect VAT at the point of sale. When declared with an IOSS number, the parcel clears customs VAT-free at the border and is delivered without additional charges — effectively DDP delivery for VAT purposes. Import duties on goods over €150 still need to be handled separately.

Under DAP, the seller delivers to the destination but the buyer pays import duties and handles customs clearance. Under DDP, the seller covers everything — the buyer has no customs obligations or extra charges. DDP gives buyers a predictable total landed cost; DAP leaves import costs uncertain until customs clearance.

Under standard DDP terms, the seller delivers goods ready for unloading but is not responsible for the unloading itself. The buyer handles unloading under DDP. If the seller is also to unload, this must be agreed separately in the contract or specified as 'DDP including unloading'.

DDP stands for Delivered Duty Paid. It is the Incoterm that places the maximum obligation on the seller — the opposite of EXW. The seller is responsible for delivering goods to the named destination in the buyer's country, paying all costs including export clearance, main freight, import customs clearance, and all import duties and VAT. The buyer simply receives the goods.

A Portuguese wine exporter sells cases of wine to a US retailer on DDP Los Angeles terms. The seller handles Portuguese export clearance, arranges ocean freight from Lisbon, clears US Customs and Border Protection in Los Angeles, pays any applicable US import duties and federal excise tax, and delivers the wine to the retailer's warehouse. The US buyer pays nothing beyond the agreed DDP price.

DDP is one of eleven Incoterms defined in Incoterms 2020 (effective 1 January 2020). Incoterms 2020 retained DDP unchanged — the seller still bears maximum responsibility including all import duties. However, one practical note added in guidance is the importance of verifying that the seller can legally act as importer of record in the destination country before agreeing DDP terms.

Risk transfers from seller to buyer when the goods are placed at the buyer's disposal at the named destination, ready for unloading. Under DDP, the seller bears all transit risk for the entire journey — from origin through export, main carriage, and import — until goods arrive at the buyer's named location.

Under DDP, the seller pays all local taxes including VAT at the destination. For EU imports, this means the seller must either appoint a fiscal representative or be registered for VAT in the EU country of delivery to account for import VAT. For B2C e-commerce to the EU valued at €150 or less, the EU IOSS scheme provides a simplified mechanism for sellers to pre-collect and remit VAT.

DDP carries significant risks for sellers: (1) import duty misclassification — if customs authorities dispute the tariff heading, the seller pays the additional duties; (2) import VAT liability — the seller must register and account for VAT in the buyer's country; (3) importer of record restrictions — some countries do not allow foreign entities to import; (4) unexpected customs delays — the seller bears costs and risks of any clearance delays. Sellers should price DDP carefully to cover all potential import costs.

Yes. DDP is increasingly standard in B2C e-commerce, where customers expect to pay a single total price with no surprise import charges at delivery. Courier companies offer DDP services for parcel deliveries — the seller pre-pays duties through the courier's customs brokerage service. For EU e-commerce, the IOSS scheme enables DDP VAT compliance for orders under €150.

Under DDP, the seller covers import duties and delivers ready for unloading; under DPU, the seller covers unloading but not import duties. DDP gives buyers the most complete service with no customs obligations; DPU gives buyers goods physically placed at their facility but leaves customs to them.

DDP does not obligate the seller to arrange cargo insurance — but since the seller bears all transit risk under DDP, it is in the seller's commercial interest to insure the goods for the full journey. Without insurance, a total loss in transit becomes an uninsured loss for the seller, who still has no right to claim payment from the buyer.