In international commercial transactions, the terms Delivery Duty Paid (DDP) and Delivery Duty Unpaid (DDU) are used to indicate two different types of sales and shipping transactions.
Delivery Duty Unpaid (DDU) is defined as the delivery of goods to the buyer at the port of destination without payment of customs duties or taxes. Marine Insight describes in details about the concept of Delivery Duty Unpaid (DDU) in their article.
Delivery Duty Unpaid (DDU)
In international commercial transactions, the terms Delivery Duty Paid (DDP) and Delivery Duty Unpaid (DDU) are used to indicate two different types of sales and shipping transactions.
The terms and conditions between the seller and buyer, when they agree to do business, may state that the seller would only be responsible for sending the goods by sea to an agreed-upon location.
However, the seller has to pay for all the export formalities and licenses. This includes expenses at the transit ports if any. In such cases, the buyer or consignee will have to clear the cargo by paying all the applicable customs duties and taxes at the port of discharge.
The seller’s responsibility ends when the goods reach the place agreed. The cargo becomes the buyer’s responsibility once it has reached the specified location.
Read More: What is Delivery Duty Paid (DDP) in shipping?
Such an agreement between the seller and buyer is termed Delivered Duty Unpaid (DDU). The International Chamber of Commerce has replaced the Incoterm DDU with DAP (Delivered at Place) in its latest publication ‘Incoterms® 2020.’ Here, the usage of ‘Delivery’ and ‘Delivered’ mean the same.
When the Incoterms® is Delivered at Place (DAP), when the goods reach the agreed destination, the customer has to be ready for its clearance by payment of customs duty and any other taxes.
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Source: Marine Insight
