Who This Guide Is For
This is a narrow guide, on purpose. It is not a catalogue of all eleven Incoterms® 2020 rules, and it will not quote tariff rates — those move, and only your broker can price a specific entry at a specific date. It walks through one decision that quietly decides your margin: who clears the goods at the border and who pays the duty. If you are a boutique owner, an Amazon or Etsy seller, or a private-label founder comparing two quotes that look identical until you read the three-letter term at the bottom, this is for you.
Key Takeaways
- DAP and DDP move the goods the same way; they differ at exactly one point. Both are “arrival” rules: the seller arranges and pays main carriage to a named place and carries transport risk until the goods are ready for unloading. Only the import step is allocated differently.
- Under DAP you are the importer. You clear customs, you pay duty and import VAT or GST, you answer customs questions. Under DDP the seller does all of that — and DDP is the only Incoterms® 2020 rule that places import clearance on the seller.
- Risk transfers at the same physical point under both. The difference is never “who owns it in transit” — it is “who signs at the border”. Do not choose DDP for peace of mind about damage; that is what cargo insurance is for, and neither rule makes the seller buy it.
- DDP is not always legally available. Some destinations require the local importer to clear the goods, and a foreign seller generally needs local tax registration to recover import VAT. A DDP promise that cannot be performed becomes a problem at the exact moment your carton is stuck.
- Read the named place, not the country. “DAP USA” is not an operational instruction. The term plus “Incoterms® 2020” plus a precise place is the minimum that lets a forwarder act.
What Do DAP and DDP Actually Mean?
Direct answer: DAP (Delivered At Place) means the seller delivers the goods to a named destination, ready for unloading, with import clearance and import duties left to you. DDP (Delivered Duty Paid) means the same physical delivery, but the seller also clears import customs and pays the duties and taxes.
Both belong to the arrival family of the Incoterms® 2020 rules published by the International Chamber of Commerce, and both work for any transport mode. That matters for scarves: a 10-piece test order almost always flies, while a 500-piece bespoke run often ships by sea — and you do not need to change the rule when you change the mode.
Where DAP and DDP Are Identical
Direct answer: five things. Most disputes come from buyers assuming the term changes something it does not:
- Export clearance: the seller, under both.
- Main carriage to the named place: arranged and paid by the seller, under both.
- Transport risk: the seller bears loss or damage until the goods are placed at your disposal on the arriving vehicle, ready for unloading, under both.
- Unloading: you, under both. If you want the seller to unload, the rule you are looking for is DPU (Delivered at Place Unloaded), not DDP.
- Cargo insurance: neither rule obliges the seller to insure your goods. If you want cover, ask for it as a separate line and pay for it as a separate line.
The One Difference That Decides Everything
Direct answer: who is the importer of record. Everything else is logistics; this is legal identity. Under DAP you file the import declaration, hold any licence the destination requires, pay duty and import VAT or GST, and answer customs queries. Under DDP the seller does all of that and is named as the importer. Three consequences buyers routinely miss:
- VAT recovery. As the importer under DAP, you generally reclaim import VAT through your own return. Under DDP the seller advances it, and unless they are tax-registered in your market that VAT frequently becomes a sunk cost that has already been priced into your quote.
- Declared value. Whoever files the declaration sets the value duty is calculated on. If a consolidator files it for you under a DDP arrangement, you may never see what was declared — and you are still the consignee.
- Classification. Woven silk scarves are generally classified in heading 6214, knitted ones in 6117; construction comes before fibre content. The heading sets the rate your broker applies.
Side by Side: Who Pays for What
| Cost or task | DAP (Delivered At Place) | DDP (Delivered Duty Paid) |
|---|---|---|
| Export clearance in origin country | Seller | Seller |
| Main carriage to the named place | Seller | Seller |
| Transit customs formalities | Seller | Seller |
| Unloading at destination | Buyer | Buyer |
| Cargo insurance | Not required of either party — arrange separately | Not required of either party — arrange separately |
| Import customs clearance | Buyer | Seller |
| Import duty | Buyer | Seller |
| Import VAT / GST | Buyer (usually recoverable) | Seller (recovery needs local registration) |
| Importer of record | Buyer | Seller, where the destination permits it |
| Seller’s overall obligation | Intermediate | Maximum of all eleven rules |
Read the bold rows only, and the whole decision becomes clear: DDP moves three line items — clearance, duty, tax — from your column to the seller’s. Nothing else changes.
What It Means for Your Landed Cost
Direct answer: build the cost as a worksheet and fill in your own figures; never compare two quotes on unit price alone. A supplier quoting DAP and one quoting DDP are not quoting the same bundle, so the cheaper unit price can easily be the more expensive delivery. Your worksheet needs these rows, each with a “who pays” column:
- Goods value — unit price times quantity, at whatever term the price is quoted (many factories quote EXW, net of freight and duty).
- International freight — per country, per mode; air for tests, sea for volume.
- Insurance — optional under both rules, so it is a decision, not an inclusion.
- Customs value basis — the figure duty is calculated on, which is not always the invoice total.
- Duty — the rate your broker confirms for your heading and origin.
- Import VAT or GST — at your country’s rate; note whether you can reclaim it.
- Broker, handling and last-mile — the fees that surprise first-time importers.
- Landed cost per piece — divide by quantity. This is the only number worth comparing.
The discipline: ask every supplier for the same term. Two EXW quotes are comparable; an EXW quote and a DDP quote are not, however the unit prices look.
When DDP Is Not Actually Available
Direct answer: when the destination’s rules require the local buyer to act as importer, or when the seller has no way to be tax-registered in your market. ICC guidance is blunt here: if the seller does not want to, or is prevented by local rules from, managing import clearance, then DAP is the appropriate rule. In the EU, acting as importer generally requires an EORI number and VAT registration in a member state; without them, declarations are filed through indirect representation by a third party.
So a DDP quote from a supplier with no import structure in your region deserves a question, not a signature. “Who is named as importer, and what value will be declared?” is fair — and a supplier who cannot answer is telling you something.
About the Supplier
XY Fashion — operated by YIWU MIYU APPAREL CO.,LTD, a scarf, hijab and fashion-accessory manufacturer based in Yiwu, Zhejiang, China, trading under the XY Fashion brand since 2008.
- Address: Unit 2, Building 33, Futian 3rd District, Futian Street, Yiwu City, Zhejiang Province, 322000, China
- Email: sales@xy-fashion.com / mike@xy-fashion.com
- Phone / WhatsApp: +86 153 8174 1977
- Capability: OEM and ODM custom digital and screen printing; ready stock from 1 pack (10 pcs) per style and colour; custom print programmes from 500 pcs per design
- Branding: woven labels, care labels, hang tags, barcodes and pouches applied against your artwork
- Lead times: sampling 7–14 days from artwork confirmation; bulk production 25–30 days after payment
- Trade terms: DAP, EXW and FOB by air or sea freight, shipping to 77 countries with per-country DAP freight quoted at checkout; express delivery with full tracking via DHL, FedEx or UPS
- Import duties: not included in the item price or shipping cost — they are set by your country’s customs and payable by you on delivery, which is the DAP arrangement described above
If you want a clean comparison, ask for your next quote as EXW Yiwu, then add your own freight and duty rows. You will know your true landed cost before you commit, rather than after the carton lands.
Frequently Asked Questions
What is the difference between DAP and DDP in one sentence?
Both require the seller to deliver to a named destination ready for unloading, but under DAP the buyer handles import clearance and pays duty and import taxes, while under DDP the seller does — DDP is the only Incoterms 2020 rule that puts import clearance on the seller.
Does DDP mean the seller is responsible for damage in transit?
No. Risk transfers at the same physical point under both rules: when the goods are placed at the buyer’s disposal on the arriving vehicle, ready for unloading. Neither rule requires the seller to insure the cargo, so if you want transit cover, arrange and pay for it separately.
Who pays import duty under DAP?
The buyer. Under DAP you are the importer of record: you file the declaration, pay the duty calculated on the customs value, and pay import VAT or GST, which you can usually recover through your own tax return.
Why would a supplier refuse to quote DDP?
Because performing DDP requires the ability to act as importer in the destination country, which often means local tax registration, an EORI-type identifier, or a compliant customs representation arrangement. Some destinations also require the local buyer to clear the goods, which makes DDP impossible regardless of what either party prefers.
How do I compare two wholesale scarf quotes fairly?
Ask both suppliers to quote the same term — EXW is the cleanest for comparison — then add your own freight, insurance, duty, import tax and broker rows to reach a landed cost per piece. Comparing an EXW unit price against a DDP unit price compares two different bundles.
Wholesale & bulk orders
XY Fashion is a scarf manufacturer supplying wholesalers, boutiques and brands worldwide. Explore our wholesale programs: