What is Delivered Duty Paid?
Delivered Duty Paid (DDP) is the Incoterms 2020 rule that places the maximum obligation on the seller: the seller delivers when the goods are placed at the buyer's disposal, cleared for import, on the arriving means of transport ready for unloading at the named place of destination. The seller bears all costs and risks to that point, including export clearance, transit, import clearance and payment of import duties, taxes and other charges. Unloading at destination is for the buyer unless it is included in the seller's contract of carriage. DDP can be used for any mode of transport. In practice the seller, or a party acting for it, must act as or arrange the importer of record in the buyer's country.
Why it matters for forwarders
DDP looks simple for the buyer but is the hardest rule to execute, because many countries restrict who can act as importer or recover import VAT, so a foreign seller may be unable to clear in its own name. In the EU, a non-EU seller needs an EORI number and usually an indirect customs representative and VAT registration; in the US, the importer of record also needs a customs bond. Forwarders offering DDP services take real risk: acting as importer of record or indirect representative can make them liable for duties, taxes and penalties, and duty rates can change between quotation and arrival. Separate freight and services from duties and taxes in quotes, pass duties through at cost with proof of payment, and state who bears tariff changes. Where the seller cannot recover import VAT, consider DAP with the buyer clearing, or exclude VAT expressly in the sales contract.