Article Summary
- What DAP and DDP mean under Incoterms 2020, and where responsibility splits between seller and buyer
- Who pays import duty, import VAT and clearance charges under each term
- What the July 2026 EU customs changes mean for parcels valued at €150 or less
- How each option affects delivery refusals, returns and repeat purchase
- A practical way to decide, based on order value, volume and destination market
A UK brand selling to a customer in Berlin has to answer one question before the parcel leaves the warehouse, which is who deals with the border. That answer is the whole difference between DAP and DDP, and it shows up in the price at checkout, in whether the carrier contacts your customer before delivering, and in who carries the cost when the rules change.
Both are Incoterms, both work for any mode of transport, and both put you in charge of getting the goods to a named destination. The split happens at import clearance, which the buyer handles under DAP and you handle under DDP.
That distinction got more complicated in July 2026, when the EU removed the customs duty exemption on low-value parcels. This guide covers what each term means, what changed, and how to decide which one belongs in which order.
What Incoterms Are and Why They Matter
Understanding DDP vs DAP is essential to deciding when DDP shipping is the right choice for your business. DDP shipping is a delivery agreement where the seller takes on all responsibilities and cIncoterms are a set of eleven standard trade terms published by the International Chamber of Commerce. The current edition is Incoterms 2020, which came into force on 1 January 2020 and is the version your contracts and commercial invoices should reference.
Each term answers the same handful of questions. Who arranges transport, who pays for it, who handles export and import formalities, and at what precise point risk passes from seller to buyer. Getting that written down removes most of the arguments that happen after something goes wrong in transit.
DAP and DDP both sit in the D group, alongside DPU, which is why they get mixed up so often. They’re also the two that turn up most in parcel-level eCommerce shipping, rather than the freight terms further up the list. DPU is the odd one out, and the only Incoterm of the eleven where the seller unloads at destination.
There’s one caveat to carry through the rest of this. Incoterms allocate cost and risk between two commercial parties, and they don’t override customs law in the destination country. Agreeing DDP with a customer doesn’t, on its own, give a UK seller the legal standing to clear goods into the EU.
What Is DAP (Delivered at Place) Shipping?
When comparing DDP vs DAP, DAP shipping terms highlight key differences in cost and responsibility. DAP shipping is a delivery agreement where the seller takes on most of the responsibilities and costs for transporting goods to a specified place, excluding import duties and taxes, which the buyer needs to pay upon arrival. Essentially, DAP shipping means the seller handles all costs and risks up to the agreed-upon place, but the buyer manages local import processes.
In DAP shipping, the seller is responsible for:
- Arranging and paying for transportation to the destination
- Handling export customs clearance
The buyer is responsible for:
- Managing import customs clearance
- Paying any applicable local taxes or duties upon arrival
DAP might be more suitable for businesses looking to reduce their upfront costs while maintaining predictable shipping expenses. This option allows buyers to take control of local import processes, which can sometimes be more efficient if they have better knowledge of local regulations.
What DAP Shipping Means
DAP stands for Delivered at Place. You arrange and pay for carriage to a named destination and carry the risk of loss or damage until the goods arrive there, ready for unloading. The buyer takes over at that point, including import clearance, customs duty, import VAT and unloading.
Under DAP, the seller is responsible for:
- Packing the goods and arranging carriage to the named destination
- Export clearance in the country of dispatch
- All transport costs up to the named place
- Risk of loss or damage until the goods arrive ready for unloading
- Supplying the buyer with the documents needed for import clearance
Under DAP, the buyer is responsible for:
- Import clearance in the destination country
- Customs duty, import VAT and any clearance or handling charges
- Unloading the goods
- Risk of loss or damage once the goods arrive at the named place
The risk transfer point catches people out, because risk passes when the goods arrive at the named place and are available for unloading, not once they’ve been unloaded. Damage caused during unloading sits with the buyer.
There’s a practical reason DAP is often the only workable term on a cross-border sale. Clearing goods for import usually requires an entity, a tax registration or a power of attorney in the destination country, and a buyer who imports regularly will already have all of that, whereas a first-time exporter won’t.
Naming the destination precisely matters just as much. DAP Berlin and DAP with a full delivery address in Berlin aren’t the same instruction, and the gap between them is where unexpected transport costs turn up.
What DDP Shipping Means
DDP stands for Delivered Duty Paid. You carry everything, including import clearance, customs duty and import VAT, right up to the named destination. It places more obligation on the seller than any other Incoterm.
Under DDP, the seller is responsible for:
- Packing the goods and arranging carriage to the named destination
- Export clearance in the country of dispatch
- Import clearance in the destination country
- Customs duty, import VAT and any other charges due on import
- Risk of loss or damage until the goods arrive ready for unloading
Under DDP, the buyer is responsible for:
- Unloading the goods
- Paying for the goods themselves
The first of those gets written up incorrectly on a lot of logistics sites, so it’s worth being precise. DDP doesn’t make the seller responsible for unloading. Unless the sales contract says otherwise, unloading stays with the buyer under both DAP and DDP, and DPU is the only term that moves it across.
What DDP demands operationally is where most UK sellers come unstuck. Offering a duty-paid price to an EU customer means having, or renting, several things:
- An EU EORI number, or an indirect customs representative acting on your behalf
- A route to account for destination VAT, through IOSS, a local registration or a broker arrangement
- Accurate commodity codes and country of origin data on every line of every order
- Enough margin headroom to absorb currency movement and duty rate changes between the point of sale and the point of clearance
B2B contracts sometimes use a middle position, specifying DDP excluding VAT and other taxes. That keeps duty and clearance with the seller while leaving destination VAT with the buyer. It’s a contractual variation rather than a standard Incoterm, so both parties need to agree to it in writing and spell out exactly what’s excluded.
What Happens on a DDP Shipment
The sequence is the same whether you’re sending one parcel or a pallet:
- Goods are prepared and checked against the destination country’s labelling, safety and documentation rules
- Carriage is arranged, either directly with a carrier or through a freight forwarder
- Customs paperwork is completed, including the commercial invoice, commodity codes and country of origin for every line
- Duty and import VAT are settled ahead of arrival, by you or by the representative declaring on your behalf
- The goods clear customs in the destination country and move to final delivery
- The customer receives the parcel with nothing left to pay and no contact from the carrier
Most of steps three to five are handled by your carrier or broker in practice. What stays with you is the accuracy of the data feeding them, which is where DDP shipments usually go wrong.
DAP vs DDP Compared
| DAP | DDP | |
| Export clearance | Seller | Seller |
| Main carriage | Seller | Seller |
| Import clearance | Buyer | Seller |
| Customs duty | Buyer | Seller |
| Import VAT | Buyer | Seller |
| Unloading | Buyer | Buyer |
| Risk transfers | On arrival at named place, ready for unloading | On arrival at named place, ready for unloading |
| Importer of record | Buyer | Seller or their representative |
| Common use | B2B and wholesale, new markets | DTC orders, established markets |
Cost and risk run the same way under both terms right up to the border. Import clearance and the charges attached to it are the only real difference, and everything that follows in this guide comes back to that.
What the 2026 EU Duty Change Means for DAP and DDP
The EU abolished its €150 customs duty exemption on 1 July 2026 under Council Regulation (EU) 2026/382, replacing it with a temporary flat €3 customs duty that runs until 1 July 2028. Our guide to the de minimis changes for UK and EU eCommerce covers the reform in full. Two parts of it bear directly on which Incoterm you use.
The €3 is charged per item, based on tariff classification rather than quantity
The European Commission’s guidance for eCommerce operators gives two worked examples: five T-shirts attract €3 as a single item, while one T-shirt plus one watch attracts €6 as two. The charge applies per line on the customs declaration, and grouping goods onto one line is a decision made at declaration rather than an automatic outcome, so ask your carrier or broker how your consignments will be declared before building the number into your pricing.
The Commission treats it as a duty on business rather than a charge on consumers
The €3 is owed by the declarant, which in a distance sale means the seller, the importer, the IOSS holder or their indirect representative. On a DDP shipment that’s clearly you or whoever declares on your behalf. Under DAP, where your customer is the importer, how the charge reaches your cost base depends on how your carrier declares and recharges it, so confirm the treatment with them rather than assuming it lands one way or the other.
How Each Option Affects Your Customers
Import VAT is what reliably turns up on your customer’s doorstep under DAP, along with whatever the carrier charges for handling the clearance on their behalf, and that combination is often larger than any duty on the parcel.
- Delivery stalls while the carrier chases payment, sometimes for a sum smaller than the delivery charge
- Some customers refuse the parcel outright, which triggers a return leg you pay for
- Support tickets land with you rather than the carrier, because the customer bought from you
- The charge arrives after the purchase decision, which is the worst possible moment for it
The carrier isn’t behaving badly here. The buyer agreed to handle import charges when the order shipped DAP, and the carrier is collecting them on the customs authority’s behalf.
DDP removes that whole sequence. Your customer sees one price, pays it once, and the parcel arrives without further contact. For a brand building repeat custom in a market, that consistency is usually worth more than the duty it costs.
The catch is landed cost accuracy. Duty and VAT have to be calculated at checkout, and getting it wrong costs you either way, since undercharging erodes the margin and overcharging costs you the basket. Running DDP at any volume means commodity codes and origin data that are correct at SKU level rather than inherited defaults applied across a catalogue.
There’s a knock-on effect on returns too. Refused DAP parcels come back as returns without ever having been delivered, which distorts your return rate reporting and ties up stock in transit for weeks. Where duty has been paid on goods that are later returned, there may be scope to recover it, though the process and the evidence you’ll need vary by member state. That’s a conversation to have with your customs broker rather than an assumption to make.
When to Use DAP and When to Use DDP
Most eCommerce brands shipping into more than one market end up using both, split by destination and order value, rather than picking one term and applying it everywhere.
Situations That Suit DAP
- B2B and wholesale orders where the buyer imports regularly and already holds the registrations, broker relationships and clearance processes
- Higher-value orders where duty is a large enough number that the customer expects to handle it and would rather control the clearance
- Markets you haven’t set up in yet, where obtaining registrations would cost more than the order volume justifies
- Buyers who clear faster locally than you can from the UK, which is common where the destination has specific licensing or documentation requirements
Situations That Suit DDP
- DTC orders where the customer expects the checkout price to be the final price
- Markets you’re actively building repeat custom in, where a single bad delivery experience costs more than the duty
- Lower-value, higher-frequency orders where the support time spent explaining a customs charge exceeds the charge itself
- Marketplace and social channels where refused parcels damage your seller performance metrics as well as your margin
A reasonable starting rule is DDP for consumer orders in your priority markets and DAP for business customers and one-off shipments elsewhere. Review it market by market rather than treating it as a company-wide setting.
When Neither Incoterm Is the Right Answer
Neither term works well if you’re sending high volumes of low-value parcels into the EU from the UK, because both leave every order crossing a border on its own. That means clearance, duty and administrative exposure repeating on every single shipment.
Holding stock inside the EU changes the shape of the problem. Orders placed by EU customers become domestic movements, with no import clearance and no per-item duty on each one, and delivery times measured against local expectations rather than international ones. The customs event happens once, on the replenishment shipment cleared at standard tariff rates, rather than hundreds of times a week.
The trade-offs come with it. Stock has to be split, forecast and funded in two places. Holding inventory in a member state can also trigger a VAT registration obligation there, or an OSS registration if you’re selling across several EU markets, and your importer of record arrangements may need to change. Green Fulfilment runs a facility in Venlo alongside its UK sites for brands using this model, and the EU fulfilment services page covers how stock gets split between the two. The cross-border shipping guide goes further into the paperwork.
One requirement applies either way. Under the General Product Safety Regulation (EU 2023/988), almost all non-food consumer products sold to EU customers need a legal Responsible Person established in the EU, with their details shown on the product or its packaging. That obligation attaches to the product rather than the shipping terms, so it applies equally to DAP orders, DDP orders and orders picked from EU-held stock.
Common Mistakes When Setting Incoterms
- Naming a country rather than a precise address. DAP France leaves the delivery point undefined and the cost of the last leg unresolved.
- Quoting DDP without the registrations to support it. Duty-paid terms need an EU EORI and a route to account for destination VAT, either directly or through a representative.
- Assuming IOSS still means no duty. IOSS covers VAT on consignments up to €150 and has never covered customs duty. Until July 2026 that made no practical difference, because the exemption meant there was no duty to pay.
- Applying generic commodity codes across a catalogue. Inherited or approximate codes produce wrong duty calculations under DDP and clearance delays under both terms.
- Letting the carrier’s default decide for you. Carrier accounts ship DAP unless configured otherwise, so a brand that believes it sells DDP can be shipping DAP on every order without knowing.
- Setting one Incoterm globally. The right answer differs by market, channel and order value.
- Leaving the version off. Contracts and invoices should say Incoterms 2020, because earlier editions define some terms differently.
- Still quoting DDU. DDU was withdrawn in Incoterms 2010 and replaced by DAP. Carriers sometimes use the label informally, but it has no standing in a current contract.
Frequently Asked Questions
Is DDP or DAP better for eCommerce?
DDP suits DTC orders, where customers expect the checkout price to be the final price and a charge at the door damages the experience. DAP suits B2B orders and markets where the buyer already imports. Most brands run both, split by destination and order value.
Who pays import duty under DAP?
The buyer. Under DAP the buyer covers import clearance, import VAT and any clearance or handling fee the carrier charges. The seller covers packing, transport to the named place and export clearance only. The EU’s temporary €3 duty works differently, as the Commission treats it as owed by the declarant rather than collected from the buyer at the door.
Does IOSS still remove customs duty on parcels under €150?
No. The €150 customs duty exemption was abolished on 1 July 2026 under Council Regulation (EU) 2026/382. IOSS still handles import VAT on B2C consignments up to €150, but the temporary €3 duty applies per item regardless of which VAT scheme you use.
Can a UK seller ship DDP to the EU without an EU entity?
Yes, though not alone. You need an EU EORI number and usually an indirect customs representative or broker acting on your behalf, plus a way to account for destination VAT. Most major carriers offer duty-paid services that package this up.
Who is the importer of record under DAP and DDP?
Under DAP the buyer is the importer of record and carries the compliance obligation for the import. Under DDP that sits with you, or with the indirect customs representative acting on your behalf, which is why DDP needs an EU EORI rather than just a willingness to pay the duty.
Do I still need an EU Responsible Person if I ship DDP?
Yes. GPSR applies to the product rather than the shipping terms. Most non-food consumer goods sold to EU customers need a Responsible Person established in the EU regardless of which Incoterm is used.
