Shipping to the USA with DAP (Delivered at Place) Terms: What You Need to Know

In this article, we examine the DAP Incoterm for the United States, meaning “Delivered At Place,” or Delivered to (followed by the delivery location within the United States).

The Incoterms® 2020 rules are the latest revision of the international trade terms published by the International Chamber of Commerce (ICC). They are internationally recognized as the most authoritative and effective way to allocate transportation costs and risks between the seller and the buyer in an international sale.

The Incoterms® 2020 rules determine whether it is the seller or the buyer who is responsible for specific tasks in international transportation and must bear the associated costs. Furthermore, they specify when the costs of transport and the responsibility for the integrity of the goods are transferred from the seller to the buyer.

The 11 commercial terms developed by the International Chamber of Commerce are conventionally listed from Ex Works (EXW), which places the least responsibility and risk on the seller, to Delivered Duty Paid (DDP), which places the greatest responsibility and risk on the seller and is by far the most preferred Incoterm for shipments to the United States. The Incoterms® 2020 Responsibilities and Risk Transfer Table summarizes the responsibilities of the seller and buyer under each of the 11 terms.

Responsibilities and Risks of “Delivered At Place” (DAP) for Shipments to the USA

According to the Incoterms® 2020 rules, DAP means that the seller is responsible for all expenses and risks of transportation until the goods reach their destination in the United States, at which point the risk transfers to the buyer.

The transfer of costs and risks from the seller to the buyer happens simultaneously when the goods are made available for unloading.

The US importer is responsible for all costs and risks associated with unloading the goods and completing the import customs process in the USA, the destination country of the shipment.

The US importer delegates the import customs operation to their customs broker and is responsible for the import duty in the USA, taxes, any applicable fees, and storage charges if the goods are not collected in a timely manner.

It is always advisable for the seller to coordinate with the US importer’s customs broker to provide all the necessary documentation for clearing the goods through customs upon importation.

This article is excerpted from the FareExport newsletter and was published with the kind permission of Dr. Roberto Coppola.