DDP Incoterms – International Delivery Terms

DDP Incoterms are standardised delivery terms created by the International Chamber of Commerce – ICC. This is a quick guide to what DDP means for the sender and receiver respectively, what you should consider as a company sending products with DDP shipping terms, and how PostNord can assist you with deliveries with DDP

What does DDP Incoterms mean?

DDP and Incoterms are abbreviations – DDP stands for “Delivered Duty Paid” and Incoterms is an abbreviation of International Commerce Terms. Incoterms is a collection of internationally viable terms, or standardised trade terms, which regulate the responsibility of buyers and sellers when transporting goods. DDP is one of those terms.

In DDP Incoterms, the seller is defined as the responsible party during the entire shipping process, until the product is ready to be picked up by the receiver. This means that the seller covers all costs and risks related to transportation – including customs clearance in the sender’s country as well as the receiver’s country.

What does DDP mean for the seller and buyer respectively?

Incoterms DDP is the delivery terms that reach farthest regarding the obligations of the supplier. This can be viewed as both an advantage and disadvantage – depending on if you’re the buyer or the seller. Companies that use DDP Incoterms as sellers are fully responsible for all costs and risks associated with shipping of the product.

Specifically for DDP, the customs clearance in the receiving country is also the responsibility of the seller. When delivering between countries, the company who sends the goods is responsible for declaring it both at the export and import level. Fees associated with this are paid by the seller.

The difference between DDP and DAP

DAP is another delivery clause of the Incoterms, with similar rules as those in DDP. There is an essential difference, however – which is important to know both as the seller and the receiver. For deliveries sent with DDP as the delivery terms, the seller must deliver the goods declared and ready – hence the title Delivered Duty Paid. With DAP Incoterms the seller doesn’t carry any responsibility for customs clearance in the receiving country. This is instead the responsibility of the buyer.

Like in DDP, in DAP it is still the seller who is responsible for all risks and other costs related to the transportation of goods. The rule about tax clearance, however, means that this term is slightly less advantageous to the buyer.

How PostNord can assist you in deliveries with DDP

As the leading supplier of transportation and logistics solutions in the Nordics, PostNord can of course be used for shipping goods between companies with DDP Incoterms as the applied terms. As a third-party supplier we make sure that the shipment is transported and delivered quickly and safely in accordance with the terms. In the unlikely event that the goods are damaged or lost during shipment, PostNord’s insurance will compensate you as the supplier – so that you can compensate your customer.

And hey, did you know that as a business client you can easily manage everything related to shipping goods and products in PostNord Portal Business? From purchasing shipping online to tracking packages, claims, collection of outgoing deliveries, and a lot more.

It only takes a minute to get a business account in the portal – completely free, of course. You can then use features like:

Learn more about the services by clicking the links.

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Frequently asked questions about DDP Incoterms

What’s the difference between Incoterms 2010 and Incoterms 2020?

Incoterms 2020 is a revised version of Incoterms 2010. In Incoterms 2020 the latest and most current terms are available – including DDP.

Can Incoterms DDP only be used for export and import?

No, the terms can also apply to domestic shipments, but for obvious reasons the section on customs clearance doesn’t apply.

Are DDP deliveries free for the buyer?

Yes. According to DDP the seller is responsible for all costs related to shipping – including customs fees.