DDP vs DAP: Costs, Customs and Shipping Responsibilities
The main difference in DDP vs DAP is who handles import customs clearance and pays import duties and taxes. Under DDP (Delivered Duty Paid), that responsibility sits with the seller; under DAP (Delivered at Place), it sits with the buyer. Both involve seller-arranged transport to an agreed destination. For a commercial shipment, compare the delivery point, clearance arrangements and quoted services before accepting either offer. The checks below include Canadian commercial imports.
For the broader booking and documentation steps, see our international shipping process.
DDP vs DAP at a glance
Both terms belong to ICC’s Incoterms 2020 rules. They can apply to air, ocean or combined transport. The term sets responsibilities between buyer and seller; the freight booking must cover the services needed to carry them out.
| Responsibility | DDP | DAP |
|---|---|---|
| Transport to the named destination | Seller arranges and pays | Seller arranges and pays |
| Export and transit customs formalities | Seller | Seller |
| Import customs clearance | Seller | Buyer |
| Import duties and taxes | Seller | Buyer |
| Normal delivery point | Named destination, ready for unloading | Named destination, ready for unloading |
| Final unloading | Usually buyer; check cost arrangements | Usually buyer; check cost arrangements |
| Cargo insurance | Confirm cover separately | Confirm cover separately |
This table shows the usual allocation. Unloading costs may already be included in the seller’s transport contract; unloading risk needs separate attention. Check the agreed rule and any specific contract terms.
Where do delivery, risk and unloading responsibilities change?
A named airport terminal and a named warehouse are different delivery points. If the sale names a terminal, confirm who will arrange and pay for the onward journey to your warehouse. Write the precise location, including the relevant terminal or receiving dock, alongside the Incoterms rule and edition.
For both DDP and DAP, normal delivery and risk transfer occur at the agreed destination, with the goods available to the buyer on the arriving vehicle, ready for unloading. Arrival at the Canadian border does not automatically complete delivery to a named inland warehouse.
Under DAP, the buyer’s import-clearance obligations also matter before final delivery. Failure to complete those obligations can create costs and risks for the buyer. Confirm the clearance arrangements before freight departs.
Keep unloading cost and unloading risk separate. A seller’s carriage contract may include unloading charges while the unloading risk remains with the buyer. Confirm the receiving arrangements, required equipment and any charge already included in transport.
Who handles Canadian import clearance?
For commercial freight entering Canada, identify the legal entity that will be the importer of record and the broker, if one is being used. Ask which business and import account will appear on the customs declaration, and confirm the arrangement with the broker before accepting the supplier’s terms.
CBSA’s commercial-import setup guidance covers the CARM Client Portal, a business number (BN) and an import program (RM) account. If a non-resident business will be the importer, CBSA directs it to obtain its business number from the Canada Revenue Agency before registering in CARM.
The importer must register its business in CARM itself; a customs broker cannot register the client’s business for it. Delegating authority to a broker is a separate step. Follow the official instructions for registering your business in CARM.
How do you compare the full cost of both quotes?
To compare DAP vs DDP quotes, use the same cargo, quantity, transport mode, named delivery point and delivery requirements. Record both offers in the same currency and check their validity dates. A warehouse-delivery offer and a terminal-delivery offer need different onward services, even if they use the same three-letter term.
Copy this worksheet into your quote comparison and complete both columns with the supplier or freight provider.
| Check | Offer A | Offer B |
|---|---|---|
| Goods price, currency and quote validity | Record amount and dates | Record amount and dates |
| Incoterms rule, edition and precise delivery point | Record all three | Record all three |
| Pickup, freight, handling and final delivery | Mark included or separate | Mark included or separate |
| Brokerage, import clearance, duties and taxes | Identify payer and exclusions | Identify payer and exclusions |
| Unloading and receiving equipment | Confirm scope and charge | Confirm scope and charge |
| Cargo insurance | Record cover or exclusion | Record cover or exclusion |
| Inspections, storage or other extra charges | Record how these are handled | Record how these are handled |
| Comparable total buyer outlay | Add quoted price and separate buyer costs | Add quoted price and separate buyer costs |
For a DAP offer, identify the import-side charges the buyer must budget for beyond the supplier’s price. For a DDP offer, check that the written inclusions reflect the seller’s import responsibilities. If an offer says DDP but excludes import duties, ask the supplier to reconcile the label with the written allocation before proceeding.
Avoid counting a charge twice when it is already included in the goods or freight price. Mark estimates and unresolved charges clearly; an unquoted item should not be treated as zero. For background on the charges themselves, read how import duties and taxes work.
When is DAP or DDP the better fit?
Choose according to who can carry out the obligations and how clearly the offer explains them. A lower headline price is useful only after the remaining services and charges are accounted for.
| Your situation | Arrangement to consider | Confirm first |
|---|---|---|
| The buyer has an established import setup and wants to manage clearance with its broker | DAP may fit | Buyer’s clearance arrangements and import-side budget |
| The seller can lawfully arrange destination import clearance and include the associated charges | DDP may fit | Named importer, broker arrangements and written inclusions |
| Neither party can explain who will clear the shipment | Resolve the import plan before choosing | A workable importer and clearance arrangement |
DDP can reduce the buyer’s clearance workload when the seller has the necessary arrangements. DAP gives the buyer responsibility for organizing import clearance. Neither term alone establishes a faster transit time, lower overall cost or insurance cover.
A Canadian shipment example
Illustration only: an overseas supplier is sending two pallets of general merchandise to an agreed receiving dock at the buyer’s warehouse in Ontario. The cargo, transport plan and named delivery point stay the same in both scenarios. This is a teaching example, not a BriCargo customer shipment or quote.
If the sale uses DAP
The seller arranges transport to the agreed warehouse point and handles export and transit formalities. The buyer arranges Canadian import clearance, pays the applicable import duties and taxes, and prepares to receive and unload the pallets. The buyer’s broker and the transport provider need the information required to coordinate clearance and onward delivery.
If the sale uses DDP
The seller takes responsibility for arranging and paying for import clearance and the applicable import duties and taxes, as well as transport to the same warehouse point. The importer and broker arrangements must support that plan. The buyer still provides required assistance and prepares to receive and unload the pallets; any unloading charge included in the transport contract should be identified.
The useful comparison is the total scope and each party’s readiness. Changing the term changes import responsibilities; it does not make the warehouse’s unloading requirements disappear.
What should you confirm before booking?
Ask the supplier to confirm these six items in writing:
- Terms and location: which Incoterms edition and exact delivery point apply?
- Import arrangement: who is the importer, who handles clearance, and what information or documents must each party provide?
- Price scope: which freight and import charges are included, excluded or billed separately?
- Receiving: who arranges unloading, equipment and any delivery appointment?
- Insurance: what cargo cover is arranged, by whom, and with what limits or exclusions?
- Unexpected charges: how will inspections, storage, failed delivery or other additional costs be handled?
Resolve conflicting wording between the sale and the freight quote before booking. Keep the agreed details with the shipment instructions so the parties work from the same plan.
Plan the freight around your agreed terms
BriCargo can review your shipment details and coordinate a freight plan around the services required. Share the supplier’s proposed Incoterms rule and named delivery point, along with the origin, destination, cargo description, package quantity, dimensions, weight, ready date and pickup or delivery needs.
Include the supplier quote and any questions about service inclusions in your enquiry. These details help identify the freight services to quote and the importer or broker arrangements that need confirmation.