DAP (Delivered At Place)
What Are DAP Terms?
DAP, or Delivered At Place, is a term used in international trade that specifies the seller's obligation to deliver goods to a designated location in the buyer's country. In DAP terms, the seller is responsible for all costs and risks associated with delivering the goods to the agreed-upon destination. This includes arranging transportation, handling charges, and insurance up to the point of delivery. The buyer, however, is responsible for unloading the goods, handling customs clearance, and paying any import duties and taxes once the goods arrive at the destination.
The term was introduced at a replacement for DDU (Delivered Duty Unpaid), although both remain in use.
Benefits of DAP Freight Terms
- Seller Control Over Transportation: Sellers retain control over the logistics of transporting goods, ensuring proper handling and timely delivery to the destination.
- Reduced Buyer Responsibility: Buyers benefit from a simplified logistics process, as the seller manages the transportation and associated risks up to the delivery point, reducing the buyer’s logistical burden.
- Predictable Costs: Buyers receive goods with a clear understanding of transportation costs, making it easier to budget and manage expenses related to shipping, excluding customs duties and taxes.
- Streamlined Delivery: DAP terms facilitate a smoother delivery process, with the seller ensuring that the goods arrive at the specified location, ready for customs clearance and final handling by the buyer.
Do DAP Terms Include Customs Clearance and Import Duty?
No, DAP terms do not include customs clearance and import duty. Under DAP, the seller is responsible for delivering the goods to the specified location and covering all associated costs up to that point, excluding import duties, taxes, and customs clearance. These costs and responsibilities fall to the buyer once the goods reach the destination.
What Is the Difference Between DAP and DDP Terms?
The primary differences between DAP and DDP freight terms relates to the payment of import duties and management of the customs clearance process.
- DAP (Delivered At Place): The seller delivers the goods to the agreed destination but does not cover import duties, taxes, or customs clearance costs. The buyer is responsible for these charges and for unloading the goods.
- DDP (Delivered Duty Paid): The seller covers all costs associated with delivering the goods to the destination, including import duties, taxes, and customs clearance. The buyer is only responsible for unloading the goods.