DDP stands for Delivered Duty Paid.
Under these terms of transport, the logistics company or freight forwarder assumes all responsibility, risk, and cost associated with transporting the goods to the port of destination.
Due to these terms, DDP transport is the best option for customers. There are no customs clearance issues.
The DDP transport process includes the following steps:
The customer pays for the goods and selects DDP transport.
Both parties negotiate the delivery location and other details of the agreement.
The logistics company or freight forwarder selects a carrier or arranges the subsequent transport and delivery of your goods directly.
The logistics company or freight forwarder clears customs for your goods in the exporting and importing countries.
Your goods go through the delivery process and finally arrive at the designated location.
You can also pick up the goods yourself using all relevant documents.
Does the DDP shipping terms include clauses regarding cargo insurance?
DDP shipping terms do not obligate you to purchase insurance for your customer or seller.
If you wish to protect your goods, you can pay for additional insurance or choose other shipping terms (such as CIP or CIF).
Does DDP shipping include VAT? Who pays for it?
Generally, all customers using DDP (Delivered Duty Paid) terms for international shipping are required to pay Value Added (VAT).
If the customer does not require payment from the carrier, this must be clearly stated in the delivery contract.
Such contracts are termed “Delivered Duty Paid, VAT Not Paid”.
Once the DDP shipping terms are completed, what destinations can be used for last-mile delivery?
Before the delivery process begins, all parties should agree on the location of the destination.
In most cases, the destination is generally:
The customer’s or their agent’s warehouse.
A private premises designated by the customer.
An overseas warehouse of another freight forwarder.
The final destination can actually be anywhere determined by the customer and the supplier.
What are the customer’s obligations under DDP shipping terms?
Under DDP rules, the buyer doesn’t have much to deal with.
However, he/she is still responsible for a few things:
- Paying Freight Charges
Obviously, the customer must pay the freight charges for this shipment as stipulated in his/her contract with the seller.
- Assisting the Logistics Company or Freight Forwarder in Obtaining Required Licenses and Authorizations
If necessary, the customer must provide additional information and other assistance to obtain the necessary licenses and other official authorizations for any imported products.
- Picking Up the Goods
The customer must pick up the goods immediately upon arrival at their final destination, or immediately designate a delivery address for the carrier to arrange delivery.
- Bearing Risks and Costs After Delivery
The customer bears all risks of loss or damage to their products after delivery to their disposal.
They also pay all costs after the products are placed at their premises.
- Paying for Product Inspection Fees
The customer pays for pre-shipment inspections unless otherwise stipulated in the agreement.