Legal Definitions - delivered duty unpaid

Delivered Duty Unpaid (DDU) is an international shipping term that defines the responsibilities of the seller and the buyer for the delivery of goods across borders. Under a DDU agreement, the seller is responsible for arranging and paying for the transportation of the goods to a specified destination in the buyer's country. This includes clearing the goods for export from their own country and covering all costs of carriage until the goods arrive at the agreed-upon location.

Once the goods arrive at the destination, the risk of loss or damage transfers from the seller to the buyer. The buyer then becomes responsible for all subsequent costs, including:

• Unloading the goods from the arriving carrier.
• Paying any import duties, taxes (such as Value Added Tax or sales tax), and other customs clearance fees required to bring the goods into their country.
• Arranging and paying for any further transportation from the destination point to their final desired location.

In essence, the seller gets the goods to the buyer's country, but the buyer handles the final steps of customs clearance and local delivery.

Here are some examples to illustrate how Delivered Duty Unpaid (DDU) works:

• Example 1: Importing Specialty Coffee Beans

  A small coffee shop owner in Seattle, USA, orders a bulk shipment of rare coffee beans from a grower in Colombia. They agree to DDU terms, with the destination being the port of Seattle. The Colombian grower (seller) arranges for the beans to be picked up, cleared for export from Colombia, and shipped by ocean freight to Seattle, covering all these costs. Once the ship carrying the beans arrives at the port of Seattle, the risk of loss transfers to the coffee shop owner (buyer). The coffee shop owner is then responsible for paying the US import duties, customs processing fees, and arranging for a local trucking company to transport the beans from the port to their shop in Seattle. This illustrates DDU because the seller paid to get the goods to the destination port, but the buyer handled the import duties and final local transport.

• Example 2: Purchasing Manufacturing Equipment

  A furniture manufacturer in Toronto, Canada, decides to upgrade its factory with a specialized woodworking machine from a supplier in Italy. The contract specifies DDU, with the destination being a specific warehouse in Toronto. The Italian supplier (seller) is responsible for packaging the machine, clearing it for export from Italy, and paying for its transportation by sea and then by truck to the Toronto warehouse. Upon the machine's arrival at the Toronto warehouse, the Canadian manufacturer (buyer) takes on the responsibility. They must pay all Canadian import duties, taxes, and any fees associated with customs clearance. They also arrange for the unloading of the machine and its installation within their factory. This demonstrates DDU as the seller delivered the goods to the specified location in Canada, but the buyer handled all import-related costs and final logistics.

• Example 3: Cross-Border E-commerce Bulk Order

  An online retailer based in Sydney, Australia, places a large order for electronic gadgets from a factory in Shenzhen, China. The terms are DDU, with the destination being the port of Sydney. The Chinese factory (seller) organizes the shipment, pays for the ocean freight to Sydney, and manages the export customs procedures in China. When the container of gadgets arrives at the port of Sydney, the Australian retailer (buyer) becomes responsible. They must pay the Australian import tariffs, Goods and Services Tax (GST), and any port handling charges. They then arrange for a local freight forwarder to pick up the container from the port and deliver it to their warehouse in Sydney. This scenario highlights DDU because the seller covered the international transport, while the buyer managed all import duties and the final leg of delivery within Australia.