ovrseasDDP: Delivered Duty Paid
D-group rule · any mode of transport · Incoterms® 2020
DDP (Delivered Duty Paid) means the seller carries the goods to the named place of destination, clears them for import and pays the import duties and taxes — import VAT or GST included unless the contract leaves it out. Risk passes there, ready for unloading — unloading is the buyer’s.
- Risk passes
- At the named destination, ready for unloading, after import clearance.
- Main freight
- Paid by the seller
- Insurance
- Neither side is obliged to insure — agree who does
- Customs
- Export: Seller · Import: Seller (duties and taxes too)
Who pays what under DDP
| Export clearance | Seller |
|---|---|
| Carriage to port / terminal | Seller |
| Loading onto main carriage | Seller |
| Main carriage (freight) | Seller |
| Insurance | Neither obliged |
| Unloading at destination | Buyer Unless unloading is included in the seller’s carriage contract (liner terms, door-to-door rates) — then the seller pays it and cannot charge it on. |
| Import clearance | Seller |
| Duties and import taxes | Seller |
How to write DDP on your documents
The rule is only complete with its named place. The destination address in the buyer’s country.
DDP Buyer’s store, 45 King St, Toronto, ON, Canada — Incoterms® 2020
Write it the same way on the quotation, the proforma, the commercial invoice and the shipping instructions — a different place on one document is a different deal.
Use DDP when
- The seller can act as importer of record in the buyer’s country (or uses a service that can).
- Business-to-consumer and small business-to-business sales where the buyer expects one landed price.
Think twice when
- The seller cannot be importer of record in that country — many countries require a local entity.
- Import VAT or GST the seller cannot reclaim — it becomes a cost the price did not include.
Many countries will not let a non-resident seller act as importer of record, and unrecoverable import VAT quietly becomes a cost.
Questions about DDP
- What does DDP mean in shipping?
- DDP (Delivered Duty Paid) means the seller carries the goods to the named place of destination, clears them for import and pays the import duties and taxes — import VAT or GST included unless the contract leaves it out. Risk passes there, ready for unloading — unloading is the buyer’s.
- Where does risk pass under DDP?
- At the named destination, ready for unloading, after import clearance.
- Who pays the freight under DDP?
- The seller pays the main carriage.
- Who pays import duties under DDP?
- The seller — DDP is the only Incoterms rule where the seller clears the goods for import and pays the duties and taxes.
- Can DDP be used for containers or air freight?
- Yes. DDP works for any mode of transport, including containers, air, road and rail.
The documents where DDP is written
- Commercial invoice template
Customs and the buyer’s bank read the Incoterm here; it decides which costs belong in the invoice value.
- Proforma invoice template
The buyer opens a letter of credit or pays a deposit on these terms — the same rule must follow through.
- Quotation template
A price means nothing without its rule: «USD 12.50 FOB Busan» and «USD 12.50 DAP Dallas» are different offers.
Compare DDP with
Incoterms® is a registered trademark of the International Chamber of Commerce. This page is an independent summary of how costs and risk are allocated and is not affiliated with or endorsed by ICC. For contract drafting, use the official Incoterms® 2020 rules published by ICC.