Lesson 7 / 11 · any mode of transport
DDP Delivered Duty Paid
The maximum for the seller: it carries the goods and the risk to the named place in the buyer's country, clears them for import and pays the duties and import taxes. The buyer unloads. It only works where the seller can legally act as importer.
Reviewed by: pending — expert review by TermVisa's editor (retired VP, international transport) in progress · Last updated
Scenario
Shoes trucked from Portugal and delivered duty paid to a UK retailer (road)
DDP Northampton Incoterms® 2020
- Seller
- Footwear manufacturer, Porto region, Portugal
- Buyer
- Fashion retailer (distribution centre), Northampton, United Kingdom
- Transport
- Road — full truckload, Porto region → Northampton, via the Channel
The seller, a footwear manufacturer near Porto, Portugal, sells 26 pallets of leather shoes to the buyer, a fashion retailer, under DDP Northampton Incoterms® 2020, naming the retailer's distribution centre in the United Kingdom. Transport is by road, including the Channel crossing. Since the UK left the EU there is a customs border, so the seller must act as UK importer: it has registered for UK VAT and appointed a UK customs agent. The retailer's staff unload at the distribution centre.
Illustrative scenario: companies are generic, and real contracts, carriers and countries add their own conditions.
The journey, stage by stage
Top bar: who pays for each stage. Bottom bar: who bears the risk of loss or damage. The red line marks where risk passes.
- Seller
- Buyer
- Depends on contract / carrier or port practice
- Point where risk passes
⚠ Risk passes when the cleared goods arrive at the distribution centre, ready for unloading.
- Loading at the seller's premises — Seller: Seller loads the trailer
- Export clearance — Seller: EU export declaration in Portugal
- Main carriage — Seller: Truck through Spain and France, Channel crossing
- Import clearance, duties and taxes — Seller: UK import declaration, duties and import VAT: seller as importer
- On-carriage to the named place — Seller: Truck continues to the Northampton DC
- Unloading at the destination — Buyer: Retailer unloads
Who does what in this scenario
| Party | What they arrange / do | Who pays (them / what they pay) | Risk they carry | Key documents |
|---|---|---|---|---|
| Seller / exporter | Acts as UK importer of record (UK VAT registration, UK customs agent), books the truck to the DC, clears and pays duties and import VAT. | Everything up to the DC door: transport, export and import formalities, duties, import VAT (which it can only recover if registered), agent fees. | Until arrival at the DC, ready for unloading — plus legal responsibility to UK customs as importer (classification, value, origin). | Commercial invoice, packing list, origin statement if a preference is claimed, export and import declarations in its name, proof of delivery. |
| Buyer / importer | Books the delivery slot, receives and unloads. | Unloading only (and costs it causes, e.g. a missed slot). | From arrival at its DC, ready for unloading. | Signed proof of delivery. |
| Origin freight forwarder | A road groupage or full-load forwarder that handles both customs declarations through partners. | Seller. | Its own errors. | Booking, customs references. |
| Destination freight forwarder | Often the forwarder's UK partner acts as the seller's customs agent. | — | — | — |
| Road carrier (trucking company) | Drives Portugal → UK, presents customs references at the border, books the DC slot. | Seller. | Liable for transit damage within limits. | Road consignment note (CMR), proof of delivery. |
| Cargo insurer | No obligation, but the seller carries the risk all the way and should insure to the DC. | Seller. | Per policy. | Seller's policy. |
| Customs broker (export) | Files the export declaration in Portugal for the seller. Most countries require one; value thresholds, exceptions and export-control checks vary — ask the broker. | Seller. | Answers to its client for filing errors; the exporter stays responsible to customs. | Export declaration and release (proof of export). |
| Customs broker (import) | Classifies the goods, files the import declaration in the United Kingdom for the seller as importer, pays duties and import taxes on its account and obtains release. See our United Kingdom page: a business with no UK establishment must register for UK VAT and get someone to deal with customs. | Seller. | The seller remains responsible to customs as importer; the broker answers to it for its own errors. | Import declaration, duty and tax receipts, release. |
| Banks (letters of credit) | Usually open account. In VAT countries the bigger financial issue under DDP is import VAT the seller may not be able to recover. | — | Credit risk on the buyer. | Invoice, proof of delivery. |
| Terminals and ports | The Channel crossing (ferry or tunnel) and the DC's booking system are the bottlenecks: missed slots are refused or charged. | — | — | — |
✗ Common mistakes
- Quoting DDP into a country where the seller cannot legally be the importer.
- “Borrowing” the buyer's import registration while calling it DDP: the paperwork no longer matches who really imports.
- Underestimating the importer's legal responsibility for classification, value and origin — audits can come years later.
- Pricing without import VAT in countries where the seller cannot recover it.
? What to ask before you sign
- Your customs broker (Seller) Can a non-resident company be importer of record here, and what registrations, guarantees or agents do we need?
- Your customs broker (Seller) What are the classification and duty rate, and do our goods meet the preferential origin rules?
- The buyer (Buyer) Is the price really all-in, including import VAT, and who is named as importer on the declaration?
- The carrier (Seller) Who books the delivery slot, and what happens if we miss it?
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