DELIVERY WITH TRANSPORT AND INSURANCE FEES PAID (DDU)
The “Delivery Duty Paid” term indicates that the seller has the same responsibilities as the CPT term, but with an additional obligation to provide insurance coverage for the buyer against the risk of loss or damage during the transportation of the goods. The seller must arrange the insurance contract and pay the insurance premium. It is important for the buyer to understand that under the CIP term, the seller is only expected to provide minimal insurance coverage.
The CIP term requires the seller to handle the export customs procedures. This term can be used for all types of transportation, including multimodal transportation.
Seller’s Responsibilities (A)
- A1: Provision of Goods as per the Contract
Provide goods and invoice or an equivalent electronic message as per the sales contract and any other necessary document required by the contract. - A2: Licenses, Authorizations, and Formalities
Obtain any required licenses or authorizations for the export of goods, and complete all customs formalities required for the export of goods. - A3: Transport and Insurance Contract
a) Transport Contract: The seller is responsible for contracting the transport of goods at their own cost to the agreed destination.
b) Insurance Contract: The seller is responsible for arranging insurance covering the buyer’s goods, and for providing the insurance policy or an equivalent document. The insurance will be arranged in accordance with the minimum coverage as specified by the Cargo Clauses. - A4: Delivery of Goods
Deliver goods to the carrier or the first carrier if multiple carriers are involved, within the agreed time frame. - A5: Transfer of Risk
The seller assumes the risk of loss or damage until the goods are delivered to the carrier as per A4. - A6: Cost Sharing
The seller is responsible for all costs up until delivery as per A4, including transport, export customs procedures, and any other necessary services. - A7: Notification to the Buyer
Notify the buyer about the delivery and any necessary preparations. - A8: Proof of Delivery
Provide the usual transport document to the buyer, such as a negotiable bill of lading, air waybill, etc., or an equivalent electronic message if the parties agree to use electronic communication. - A9: Control, Packaging, and Marking
The seller is responsible for any required inspections, packaging, and labeling for transportation. - A10: Other Obligations
Help the buyer obtain any necessary documents for importation or transit to another country, with costs covered by the buyer.
Buyer’s Responsibilities (B)
- B1: Payment for Goods
Pay the price of the goods as per the sales contract. - B2: Licenses, Authorizations, and Formalities
Obtain any required import licenses and complete all necessary customs formalities for importing goods. - B3: Transport Contract
The buyer does not have any obligations in this regard. - B4: Receipt of Goods
Accept the goods upon delivery as per A4. - B5: Transfer of Risk
Assume all risks related to the goods once delivered as per A4. - B6: Cost Sharing
The buyer is responsible for costs incurred from the moment goods are delivered, including transportation, customs duties, and any other charges for transit. - B7: Notification to Seller
Notify the seller regarding the time and destination for the delivery of goods. - B8: Proof of Delivery
Accept the transport document as per A8, if in accordance with the contract. - B9: Inspection of Goods
The buyer is responsible for inspection costs unless otherwise agreed or required by authorities in the exporting country. - B10: Other Obligations
Cover all costs related to obtaining documents or assistance provided by the seller, and reimburse the seller for any expenses related to those services.
This summary outlines the responsibilities of both the seller and buyer under the CIP (Carriage and Insurance Paid To) term in international trade.