Comprehensive guide to DAP, DPU, and DDP Incoterms delivery scenarios across different transportation modes.

Introduction

When and where exactly DAP and DDP ocurrs?

• In DAP and DDP the seller delivers loaded

In practice, there are two options for delivery.

• At a terminal. A carrier facility like a container yard from a shipping line, a yard from a rail operator or a depot from a landside transportation company.
• The buyer’s facility

The transportation of goods from the terminal to the buyer’s facility involves several steps. Typically, the buyer is responsible for clearing customs, while the seller arranges for the cargo to be delivered from the terminal to the buyer’s location. If customs clearance is delayed, the terminal may impose additional storage fees for the extended time the cargo remains there.

DAP/DDP delivery for FCL

The delivery typically happens at a Container Yard (CY) or at buyer’s premises.

When the seller delivers goods inside a container at the Container Yard (CY), the Destination Terminal Handling Charges (DTHC) become the buyer’s responsibility. Upon delivery, the buyer assumes full financial and logistical obligations, including customs clearance and all subsequent expenses associated with the cargo.

Delivering goods directly to the buyer’s premises introduces significant complexity and risk for the seller. In this scenario, the seller is responsible for paying the Destination Terminal Handling Charges (DTHC) and transportation costs to the buyer’s location. The seller’s exposure increases substantially because the timeline depends entirely on the buyer’s import customs clearance process, which can be unpredictably lengthy. Moreover, the seller bears the financial burden of additional charges during the customs clearance period. These include:

• Empty container return fees
• Potential demurrage charges
• Container detention costs
• Terminal storage expenses

These accumulated charges can quickly erode the seller’s profit margin and create financial uncertainty, making this delivery method considerably more challenging and potentially costly for the seller.

DAP/DDP delivery for LCL

When goods are delivered to a Cargo Freight Station (CFS), they have already been unloaded from the transportation vehicle. In this scenario, the Delivered at Place Unloaded (DPU) Incoterm is the most appropriate and recommended delivery method. DPU provides a clear allocation of risks and costs, ensuring that the seller is responsible for delivering and unloading the goods at the specified destination before transferring responsibility to the buyer.

When goods are delivered to the buyer’s premises, the seller becomes vulnerable to potential complications arising from the buyer’s import customs clearance process. This arrangement introduces significant uncertainty and financial risk for the seller. The customs clearance procedure can experience unexpected delays, triggering additional charges at the Cargo Freight Station (CFS), typically manifesting as storage or handling fees. Under this delivery method, the buyer assumes responsibility for two critical aspects:

• Completing the import customs clearance process
• Arranging and covering transportation from the CFS to their premises

These extended responsibilities can create a complex logistics scenario where the seller remains exposed to potential financial penalties and operational inefficiencies.

DAP/DDP delivery for Airfreight

In airfreight, the standard operational procedure involves the airline unloading goods and immediately transferring them to a designated warehouse. Goods rarely remain at the airport itself, making direct airport delivery impractical. After being unloaded from the aircraft, the cargo is transported to a nearby warehouse facility, operated by a terminal handling operator.

Due to this operational workflow, sellers cannot effectively use Delivered at Place (DAP) Airport as an Incoterm. Instead, the more precise and appropriate term would be “DAP Warehouse Airport XXX,” which accurately reflects the actual point of delivery and transfer of responsibilities.

When delivering goods to the buyer’s premises, the seller incurs multiple financial responsibilities in the air freight logistics process. These obligations include:

• Destination Terminal Handling Charge (DTHC). Paid to the airline handling operator
• Airport Transfer Fee
• Potential Additional Storage Fees
• Transportation to Buyer’s Facility

This delivery method places substantial operational and financial burdens on the seller, requiring careful management of time, costs, and potential logistical complications.

DAP/DDP delivery for Rail

In rail freight logistics, the terminal follows a standard operational workflow: goods are unloaded from the railcar and transferred to a designated yard. The seller takes possession of the cargo at this point, with the rail terminal implementing specific handling procedures. The terminal imposes two primary charges:

• Terminal Handling Fee
• Storage Charges

Due to these operational dynamics, delivering goods as “DAP Rail Terminal, Unloaded” is not technically feasible. The actual delivery point requires more precise specification, reflecting the complex logistics of rail freight transportation.

When delivered at buyers premises, the buyer is responsible for the rail terminal handling charge and subject to the import custom clearance by the buyer.

A more apropiated term will be DPU.

DAP/DDP delivery for Road

When delived by road the usual option is to deliver the goods unloaded at the border. The transportation vehicle cannot remain at the border, a terminal must be used. Any extra expense due to delays are under the sellers risk.

When delivered to the buyers premises, the trucking company has a free time for unloading (for example 3 hours). It must be clear which party is responsible for the extra expense if a delay ocurrs.

A more appropiated term is DPU.

DAP/DDP delivery for Sea Bulk or Sea Brakebulk

In maritime shipping, determining the responsibility for Destination Terminal Handling Charge (DTHC) is critical. While goods are loaded into the vessel and typically unloaded without immediate customs clearance, the allocation of DTHC between buyer and seller requires explicit agreement. Key Points:

• Buyer usually handles customs clearance
• Unloading often occurs before customs processing
• Clear definition of DTHC responsibility prevents potential disputes

The operational workflow necessitates precise contractual terms to avoid misunderstandings about financial obligations during maritime cargo delivery.

If a vessel is equipped with an unloading crane, additional charges may be imposed directly to the buyer for container unloading services. This unexpected cost requires careful contractual clarification to prevent financial surprises during maritime cargo delivery.

A much appropiate term is DPU.