DDU Incoterm, meaning “Delivered Duty Unpaid” or “Delivered Without Duty Paid“, is an international trade term defining the responsibilities of the seller and buyer in a delivery. Under this incoterm, the seller covers all costs related to delivering goods to the agreed location in the buyer’s country, except for customs duties and other import taxes.
In other words, the seller handles the primary transportation and delivery of goods up to the border or delivery point, but the buyer is responsible for customs clearance and paying the duties and taxes.
This incoterm is favored by importers who prefer control over customs procedures in their own country.
Responsibilities Under the DDU Incoterm
Seller’s Responsibilities
Under the DDU Incoterm, the seller assumes several responsibilities, including:
- Packaging the goods and making them available for transportation;
- Handling transportation to the buyer’s country, covering handling costs, primary transport fees, and insurance up to the agreed location;
- Clearing customs for export, ensuring the shipment exits the country of origin;
- Notifying the buyer of the goods’ arrival at the destination point.
The seller does not pay customs duties, import taxes, or fees related to customs clearance in the importing country.
Buyer’s Responsibilities
The buyer, on the other hand, must assume several key obligations:
- Paying customs duties and other taxes in their country once the goods arrive;
- Handling customs clearance for import, ensuring the goods meet the destination country’s regulations;
- Covering additional fees related to delivery if obstacles prevent the goods from reaching the agreed address.
In summary, while the seller assumes a significant share of responsibilities, the buyer is responsible for finalizing delivery and covering import-related costs.
Advantages and Disadvantages of the DDU Incoterm
Advantages for the Seller
Limited responsibility for customs procedures: The seller is not responsible for customs formalities in the importing country, simplifying their logistical processes.
Visibility up to the delivery point: Sellers maintain control over primary transportation until the agreed delivery point, ensuring goods are shipped as expected.
Advantages for the Buyer
Full control of customs procedures: Buyers manage customs clearance in their country, optimizing customs costs based on their strategies.
Negotiation of customs duties: Buyers can decide when to pay duties and aim to minimize financial impacts.
Disadvantages
- For the Seller: The DDU Incoterm requires careful transport management, as the seller bears responsibility for the main transport to the destination country.
- For the Buyer: Buyers handle all customs formalities, which can lead to administrative complications without the necessary expertise.
Why Partner with an Expert Like MWT Sourcing?
Choosing the best incoterm requires genuine expertise in logistics. Partnering with MWT Sourcing helps you efficiently manage these processes and reduce associated costs.
Expertise in Incoterm Management
The DDU Incoterm offers many benefits but requires a solid understanding of customs formalities and logistical risks. MWT Sourcing guides you in selecting the incoterm that best suits your needs and optimizing your international logistics to ensure seamless operations.
Optimizing Transport Costs
With extensive expertise in international trade, MWT Sourcing can negotiate competitive transport rates and ensure your goods arrive on time while minimizing unexpected expenses.
On-the-Ground Presence
With a local presence, MWT Sourcing manages logistics at every stage and location, whether in China, Europe, or elsewhere. This ensures quality and compliance for your goods at every step of the import process.
While waiting to benefit from our practical advice, you can familiarize yourself with incoterms by consulting our free incoterm guide.
