QUICK ANSWER DDP shipping (Delivered Duty Paid) is the Incoterm where the seller delivers goods to a named destination with freight arranged, import clearance handled, and duty paid, delivered to your door. What DDP does not transfer is accountability to US customs. If the entry runs under your name, the penalties are yours. If it runs under a third party that files it badly, CBP detains cargo that is physically yours, whatever the contract says.
DDP shipping is the most tempting offer on a supplier's quote sheet: the freight, customs, and duty all stop being your problem. Whether they actually stop being your problem depends entirely on whose name ends up on the customs entry. This guide covers what the term transfers, what it costs, and the two failure modes every US importer should be able to name before accepting it.
What DDP means in practice
Delivered Duty Paid is one of the eleven Incoterms 2020 rules, and it sits at the far end of the scale: the seller carries maximum obligation, the buyer minimum. The seller arranges every leg, clears the goods for import into the US, pays the duty, and delivers to the named place. Risk transfers to the buyer only when the goods arrive at that place, ready for unloading.
Who does what under DDP
| Obligation | Seller | Buyer |
|---|---|---|
| Export clearance at origin | Yes | |
| International freight | Yes | |
| Import clearance into the US | Yes | |
| Duty, tariffs, and import fees | Yes | |
| Delivery to the named place | Yes | |
| Unloading and receiving | Yes | |
| Providing information for filings | Yes |
DDP is the only Incoterm that puts import clearance and duty on the seller. That is exactly what makes it attractive, and exactly what makes it structurally odd: the party with the least presence in the destination country takes on the destination country's legal process.
DDP, DAP, and FOB side by side
Three terms cover most of what US importers are actually offered, and the differences sit in three questions: who books the freight, who clears US customs, and who pays the duty.
DDP vs DAP vs FOB on a US import
| DDP | DAP | FOB | |
|---|---|---|---|
| Who books the international freight | Seller | Seller | Buyer |
| Who clears US customs | Seller | Buyer | Buyer |
| Who pays duty and tariffs | Seller | Buyer | Buyer |
| Who controls the destination side | Seller | Buyer | Buyer |
| Old name people still search | DDU (retired in 2010) |
DAP is DDP minus the customs and duty: the seller still delivers to your door, but the entry and the duty bill stay under your control. FOB moves the split all the way back to the origin port, with everything from the vessel onward in your hands; the FOB vs EXW comparison covers that end of the scale.
What sits inside a DDP price
A DDP quote compresses seven lines into one number, and compressed is not the same as cheap. It means none of the lines can be seen, compared, or verified, including the one that matters most to CBP: the declared value the duty was calculated on.
The lines inside a DDP quote
| Line | What it covers | Visible to you under DDP? |
|---|---|---|
| Goods | The product itself | Yes, on your invoice |
| Origin charges | Pickup, export handling, origin terminal | No |
| Ocean or air freight | The international leg | No |
| Destination charges | US terminal and handling | No |
| US duty | HTS rate on the declared value | No, including the declared value itself |
| Section 301 tariff | 7.5% to 25% on many China-origin goods | No |
| Final delivery | Port to your warehouse | No |
KEY TAKEAWAY A DDP price meaningfully below your own FOB-plus-duty math is not a discount. Somewhere inside that number a line is being skipped, and the usual candidates are the declared value and the Section 301 tariff.
The two risks a DDP shipment creates
DDP failures land on US importers in two distinct ways. They get blurred together in most warnings, and they should not be, because the mechanics and the consequences are different.
Risk one: you are the importer of record without knowing it
Many sellers offering DDP have no US entity, so their forwarder files the entry under the buyer's name and EIN, and the buyer has signed nothing beyond a proforma invoice. If that entry declares a lower value to keep the quoted price attractive, or slides the goods into a friendlier HTS code, the violation belongs to the named importer of record: you. Under 19 USC 1592, CBP pursues the importer of record named on the entry for undervaluation and misclassification, and your contract with the seller does not bind CBP. The first sign is usually a notice arriving months after the goods sold through.
Risk two: the ghost importer of record
The other version runs the entry under a third party, a shell importer or the forwarder's own entity, and your name appears nowhere. The exposure flips: the entry can be defective or the duty unpaid, and when CBP acts on it, a hold, an exam, or a seizure, the action lands on cargo that is physically yours. You have no standing on an entry you are not party to, storage accrues while it gets untangled, and the seller who promised duty paid is an email address half a world away. Unpaid Section 301 duty and undervalued entries are a standing CBP enforcement focus, which makes it a bad position to be holding goods that came in under either flag.
When DDP makes sense
DDP is not a scam; it is a tool with a narrow lane. It fits samples and low-value test orders where the downside is capped, marketplace purchases where the platform runs a real compliance operation, and sellers with a genuine US entity that files entries under its own name and can prove it. What these cases share is that the seller's import setup is real and inspectable, or the stakes are too small to matter. A first shipment at commercial volume shares neither trait.
How to take a DDP offer safely
If the DDP price is good enough to consider, three questions separate the usable offers from the traps. Ask who will appear as importer of record on the entry, in writing. Ask to see the declared value against your commercial invoice for the first shipment. And if the answer to the first question is your own company, stop treating it as the seller's customs process, because it is yours, run by strangers. The clean alternative costs little: buy the same delivery on DAP terms and run the entry under your own control, which keeps the convenience and moves the declared value back where you can see it.
How Platton structures it instead
When a supplier pushes DDP, the usual reason is simple: one bundled number is easier to sell than seven visible lines. The structure Platton sets up for importers keeps the convenience without the blind spots:
DAP delivery with your own entry
The supplier still handles origin and freight if that is the deal you want; the entry is filed on your behalf under your own importer number, with the declared value taken from your commercial invoice and the duty estimated before the goods ship.
The freight leg quoted line by line
An itemized ocean freight quote on your lane, China to the US or any other origin, shows origin charges, freight, destination charges, and delivery as separate lines, so a DDP offer has something honest to be compared against.
Delivery without the duty gamble
Drayage and final delivery run on schedule either way; the difference is that nothing about your duty position is riding on the supplier's paperwork.
Have a DDP quote on the table? Send it over and get the itemized comparison for the same lane: request a quote.
Common questions about DDP shipping
Is DDP shipping legal in the US?
Yes. DDP is a standard Incoterms 2020 rule, and a foreign seller can lawfully act as importer of record if it is properly registered with CBP, including a CBP-assigned importer number. What is not legal is how some DDP arrangements are executed: undervalued invoices, misclassified goods, or entries filed under a buyer's name without their knowledge. The term is legitimate; the corner-cutting that often funds the attractive price is not.
Does DDP shipping include tariffs and Section 301?
On paper, yes: DDP obliges the seller to pay all import duties and tariffs, including Section 301 amounts on China-origin goods. In practice, the tariff is the largest single line the seller can shrink by undervaluing the entry, which is why a DDP price that undercuts the tariff math deserves suspicion rather than celebration. If CBP later collects, it collects from whoever the entry names as importer of record.
What is the difference between DDP and DAP?
One line: customs and duty. Under both terms the seller arranges transport and delivers to the named US destination. Under DAP the buyer clears customs and pays the duty; under DDP the seller does both. That single difference moves the declared value, the HTS classification, and the relationship with CBP from your hands to the seller's, which is why DAP plus your own entry is the standard fix for a risky DDP offer.
Is DDP cheaper than shipping FOB?
A legitimate DDP price is normally higher than the same shipment bought FOB, because the seller charges for taking on the freight, the clearance, and the duty risk. A cheaper-than-expected DDP offer is funded from somewhere: consolidated freight rates at best, an undervalued entry at worst. Compare it against an itemized quote for the identical lane before reading it as savings.
Who is the importer of record under DDP?
In the clean version, the seller or its US entity, registered with CBP under its own importer number. In the common gray version, the buyer, whose name and EIN go on an entry they never see. In the worst version, a shell party unrelated to either side. The answer decides who CBP pursues when something is wrong, so it is the first question to ask before accepting any DDP term.
When is DDP shipping worth it?
When the downside is capped or the seller's US import operation is real: samples, small test orders, marketplace purchases with platform-run compliance, or an established supplier with its own US entity filing entries in its own name. For recurring commercial volume, the calculation flips, because the money DDP saves in convenience is smaller than the exposure it creates on declared value and tariffs you cannot audit.
Related incoterm and import guides
Incoterms 2020: the full guide: all eleven terms and where DDP sits among them.
FOB vs EXW: the origin-side terms most first orders should use instead.
How to import goods into the US in 9 steps: the process DDP promises to run for you, step by step.
First-time importer guide: sizing and structuring a first shipment without the shortcuts.
Landed cost: full breakdown: the per-unit math a DDP price never shows you.
What is an import freight forwarder?: the role that runs the import side under your control.
