Incoterms Explained: Delivered At Place (DAP)

Delivered at Place (DAP) is one of the 11 Incoterms (International Commercial Terms) used by the International Chamber of Commerce. It defines when responsibility passes from the seller to the buyer during the international shipping process.

In this article, we explain what DAP means, how it works, the benefits and challenges to buyers and sellers, and how it compares to other Incoterms.

What does DAP mean?

Under the Delivered at Place (DAP) Incoterm, the seller assumes all the responsibility for delivery. They must transport goods to a location specified by the buyer (such as a port, warehouse, or other facility) and assume all risks and costs until the goods arrive.

However, the buyer is responsible for unloading the goods, paying import duties, and any onward transportation if required.

DAP can be used for any transport mode — air, sea, road or rail — making it a great choice for multimodal shipments. For example, many British retailers ship DAP when buying goods from China and the Far East.

An example of DAP in action

Let’s illustrate how DAP works with a practical example of a UK retailer using DAP to purchase goods from the Far East:

• A UK-based furniture retailer orders a shipment of home décor items from a manufacturer in China.

• Under the DAP Incoterm, the Chinese seller is responsible for all costs and risks involved in transporting the goods from their factory in China to the retailer’s warehouse in the UK. This includes export packaging, export customs clearance, ocean freight and inland transportation within the UK up to the retailer’s specified warehouse address.

• Once the goods arrive at the UK warehouse, the responsibility shifts to the UK retailer, who must handle import customs clearance, pay any import duties and VAT, and cover unloading costs at their facility.

This scenario illustrates how DAP facilitates smooth cross-border trade by clearly delineating responsibilities, reducing risks for buyers new to importing and providing sellers with control over the international freight leg.

What are my responsibilities as a buyer under DAP?

Although the seller takes responsibility for the entire shipping process, there are several things the buyer must do. These include:

• Clearing import customs

• Submitting relevant documents, paying duties and coordinating with local authorities

• Unloading goods

• Arranging final mile tanspot if necessary

The buyer also assumes all risk and liability as soon as the goods arrive in the destination port or warehouse.

What are my responsibilities as a seller under DAP?

Sellers are mainly responsible for the delivery of goods under DAP. They must:

• Contract and pay for the main carriage to the buyer’s named destination

• Clear export customs and arrange any necessary documentation, like a bill of lading

• Purchase insurance to cover the goods while in transit.

• Arrange for proof of delivery

Risk transfers to the buyer only when goods are ready for unloading at the destination.

What are the advantages of DAP for buyers and sellers?

DAP offers several advantages to buyers and sellers.

For sellers:

• It offers market expansion opportunities. Offering a door-to-place service enhances competitiveness, particularly in markets where buyers prioritise streamlined logistics.

• It makes costs predictable. Sellers control freight negotiations and routes, avoiding unexpected expenses from buyer-led decisions.

For buyers:

• There is greater customs autonomy. Buyers leverage local expertise to minimise duty payments and avoid overpayment through tariff classification strategies.

• There is less administrative burden. Sellers handle international transit complexities, allowing buyers to focus on their core operations.

What are the challenges of DAP for buyers and sellers?

Despite DAP’s benefits, there are several challenges that buyers and sellers should be aware of.

For sellers:

• Unforeseen delays and costs can disrupt operations. Port strikes, rerouting due to geopolitical conflicts, or congestion at terminals can escalate costs

• Ambiguity around unloading responsibilities. Miscommunication about the “named place” can lead to disputes

For buyers:

• Hidden charges can rack up. Delays in import clearance may incur storage fees or demurrage charges

• Insurance gaps can cause issues. Buyers often overlook insuring goods from the delivery point, which can be an expensive mistake if damage occurs during final-mile transport

When should I buy and sell using DAP?

There are plenty of scenarios where using DAP makes sense for buyers and sellers:

• When buyers want the seller to handle shipping. DAP is ideal if you want the seller to handle all transportation and delivery logistics up to your specified location, allowing you to focus on your business.

• When buyers need delivery to a specific location, not a port. If your business requires goods delivered to a specific site, whether that’s your warehouse, a bonded warehouse, or a regional distribution centre, DAP allows you to designate that exact place.

• When buyers want control over the import process. Buyers who prefer to handle import duties themselves will prefer DAP, since you assume responsibility for import clearance and associated costs. It also reduces risks for the seller, compared to an alternative Incoterm like Delivery Duty Paid (DDP).

In short, buyers should choose DAP when they want the seller to handle transportation, but retain control over import customers. Sellers should offer DAP when they want to provide a competitive and comprehensive service without assuming the risk of obtaining import clearance.

What other Incoterms are there?

The International Chamber of Commerce (ICC) uses 11 Incoterms to define how costs, risks and responsibilities are divided between buyers and sellers in international trade. Other Incoterms include:

• EXW (Ex Works): The seller’s responsibility ends when the goods are made available at their premises. From that point forward, the buyer assumes all risks and costs associated with transportation and export.

• FCA (Free Carrier): The seller delivers the goods to a carrier or another location designated by the buyer, covering all costs and risks up to that delivery point.

• CIF (Cost, Insurance, and Freight): The seller arranges and pays for transportation and insurance of the goods up to the destination port, transferring risk to the buyer once the goods are loaded on board.

• FOB (Free On Board): The seller is responsible for delivering the goods onto the vessel at the port of origin. Risk and costs transfer to the buyer once the goods are on board the ship.

• DDP (Delivered Duty Paid): The seller assumes all costs and risks, including export and import customs clearance, duties, and taxes, delivering the goods ready for unloading at the buyer’s specified location.

Get a DAP quote from the Far East with Pro Carrier

DAP Incoterms offer a balanced framework for international shipping, helping sellers offer a competitive service while streamlining logistics and costs for buyers.

Finding the right Incoterm for your shipment isn’t always obvious, however. That’s why it pays to work with a trusted partner like Pro Carrier. Our reliable international freight forwarding service is backed by innovative technology and customer service excellence.

Take Horizon, our all-in-one supply chain platform, for example. It gives you complete visibility into your shipments, letting you track them wherever and whenever you like. We also ensure the smooth passing of import customs when you ship DAP, thanks to our proactive service that works two weeks ahead of schedule.

Speak to one of our experts today to learn how to ship from the Far East to the UK using DAP or another Incoterm.