What DDP shipping means, and how DDP is different from DAP

Two quotes can name the same delivery address and still leave you with very different bills. One says DDP, the other says DAP, and the difference is who deals with US Customs and pays the duties.

What does DDP shipping mean?

DDP stands for Delivered Duty Paid. It’s one of the 11 Incoterms rules published by the International Chamber of Commerce (ICC), the standard trade terms buyers and sellers write into contracts.

Under DDP, the seller gets the goods to the place you name, such as your business address, and takes care of everything on the way. That includes export clearance in the country of origin, the freight, US import clearance, and the duties and taxes due on import. The ICC calls DDP unique, because it’s the only rule where the seller pays the tariffs.

Delivery happens when the goods arrive at your address, still on the truck and ready for unloading. That’s also the moment the risk of loss or damage passes to you. Unloading is your job.

What does DAP mean?

DAP stands for Delivered at Place. The seller arranges and pays for transport to the named place, handles export clearance, and carries the risk until the goods arrive there.

The difference is at the border. Under DAP, you clear the goods through US Customs and pay the duties. The ICC Academy puts it this way: “The buyer must manage and pay for all import clearance formalities.” You also carry the risk of loss or damage while the goods go through customs.

As with DDP, delivery happens before unloading, and you unload.

DDP vs DAP: what’s the difference?

Import clearance is the one real difference. Everything up to the US border works the same way.

	DDP (Delivered Duty Paid)	DAP (Delivered at Place)
Transport to your named place	Seller	Seller
Export clearance	Seller	Seller
US import clearance	Seller	You
Duties, tariffs and import taxes	Seller	You
US customs fees (MPF, and HMF for sea freight)	Seller	You
Risk of loss until delivery	Seller	Seller, except during import clearance, which is on you
Unloading at your site	You	You
Who’s usually the importer of record	Seller	You

DAP, DPU and DDP can all be used for any mode of transport, including ocean, air, truck or a mix. There’s also DPU (Delivered at Place Unloaded), which replaced the old DAT term in Incoterms 2020. The ICC says unloading is the only difference between DAP and DPU: under DPU, the seller unloads. You still handle import clearance and duties under DPU.

The fees in that table are covered in our guide to the Merchandise Processing Fee and Harbor Maintenance Fee.

Who is the importer of record?

The importer of record is the party that files the entry with US Customs and answers for it. Under federal law, that’s the owner or purchaser of the goods, or a licensed customs broker they designate. Whoever files has to use “reasonable care”.

This matters because of who owes the money. Federal regulations make duties “a personal debt due from the importer to the United States”. Paying a broker doesn’t clear that debt if the broker fails to pay.

Under DAP, the importer is normally you. You’ll need:

• a licensed customs broker to file the entry, unless you file it yourself
• a customs bond, single entry or continuous, before goods on a formal entry are released
• the commercial invoice, packing list and transport documents from the seller
• the tariff classification and duty rate for each product

Under DDP, the seller takes on that role and its costs, and builds them into the price.

Can an overseas seller really ship DDP to the US?

Yes, but it has to be set up properly. A foreign company can be the importer of record in the US. Federal regulations say a nonresident corporation can only enter goods if it has a resident agent in the state of the port of entry, authorized to accept legal papers on its behalf, and files a bond with a US-resident surety.

The ICC warns sellers that DDP puts import clearance in the buyer’s country on them, which “can be difficult and costly”, especially for small and mid-sized sellers. For US imports, it adds that clearance may need a local certificate or other authorization, depending on the goods, the agencies involved and the state. Where the seller can’t or won’t handle that, the ICC suggests DAP or DPU instead.

So when an overseas supplier offers DDP, ask whose name will go on the entry as importer of record, and who holds the bond.

What risks stay with you under DDP?

DDP moves the paperwork and the duty bill to the seller. A few risks still land on you.

• Unloading. Under DDP and DAP, delivery happens with the goods on the truck. If your site has no loading dock, sort out a liftgate or a forklift before the truck arrives.
• Damage after delivery. Risk passes to you at delivery, so inspect and count before you sign.
• Goods held at customs. Under federal regulations, unpaid duties are a lien on the goods while they’re in US Customs custody. That holds even when the seller is the one who owes the duty, so a DDP seller’s unpaid bill can still hold up your equipment.
• Tariff changes. Under DDP the seller pays the tariffs, but Incoterms don’t set the price. The ICC notes that clear terms can “support price renegotiation when tariff rates are revised mid-contract”. Read what the quote says about tariff changes, and how long the price holds.
• Payment and ownership. Incoterms don’t cover when you pay or when the goods become yours. Those belong in the contract or quote.

Should you buy DDP or DAP?

Neither is right for every order. The ICC Academy says there’s no “right or wrong” rule, only the one that fits the deal.

DDP usually fits better when:

• this is your first import, or you don’t have a customs broker and bond
• you want one price that covers the duties
• the seller has a clear setup for US entry

DAP usually fits better when:

• you already import and have a broker and a bond
• you want to control the tariff classification and the customs filing
• the seller can’t act as importer of record in the US

Whichever you pick, write it in full on the contract: the rule, the exact place and the Incoterms version. For example, “DDP” followed by your full delivery address and “Incoterms 2020”. The ICC also points out that the US government uses some of the same abbreviations, such as FOB, in domestic rules with a different meaning, so name the Incoterms version to avoid confusion.

Before you compare a DDP quote with a DAP quote, add the duties, customs fees, broker, bond and port charges to the DAP price. Our guide to what a landed price includes lists each of those costs.

How Tally Wholesale’s landed price relates to DDP

Our landed price works like DDP. We quote one price per unit, in US dollars, covering the equipment, freight, customs clearance and duties to your US delivery address. We import the equipment, pay the duties and clear customs, so you don’t need a broker or a bond, and you won’t get a separate duty bill.

Your quote sets out the delivery terms, such as curbside or dock delivery and whether a liftgate is included, and the delivery timeline. Quotes are valid for 14 days. A 30% deposit starts production, and the balance is due before the equipment ships. If equipment arrives damaged, defective or short, report it with photos within 7 days of delivery and we’ll replace or credit it, as set out in our shipping and returns policy. How it works walks through each step, and the terms of sale have the details.

To see a delivered price for your equipment, request a quote with the equipment, quantity and delivery ZIP code.