Meaning
International commercial arrangements specify that the seller assumes all risks and costs, including transport, duties, transport insurance and clearance, until the goods reach the buyer’s destination. Under these delivered duty paid terms, the exporter handles the entire logistics chain and complies with import regulations. The obligation starts at the point of origin and terminates when the goods are made available to the buyer at the specified location.
It does not cover the unloading of the goods from the vehicle unless agreed otherwise.
Sellers Obligation
Exporters must register for tax purposes in the destination country to execute these shipments correctly. Under these delivered duty paid terms, the seller pays both foreign customs duties and local value-added taxes. This ensures a frictionless receipt for the end-user.
Landed Cost
Buyers prefer this arrangement because it eliminates unexpected post-purchase fees. The price agreed upon at checkout matches the final landed cost, protecting the buyer’s operating margins from fluctuation.
Contractual Penalty
Delay in customs clearance due to incorrect documentation can trigger demurrage fees that the seller must absorb. If the goods are damaged during transit, the seller remains responsible for replacement. This makes the risk assessment critical before signing the sales contract.
