DDP vs DDU

The whole DDP-versus-DDU question comes down to one thing: who deals with import duty and VAT. Under DDP, the seller takes full responsibility — they clear the goods through import customs in the destination country and pay any duty and import VAT, so the buyer receives the goods with nothing further to pay. Under DDU, the seller delivers the goods to the destination but stops short of import clearance; the buyer must pay the duty and VAT, often to the carrier, before the goods are handed over.

For an end customer, this difference is dramatic. A DDP parcel arrives with no extra charges, exactly as priced at checkout. A DDU parcel can be held by the carrier until the customer pays a surprise duty-and-VAT invoice plus a handling fee — a classic cause of refused deliveries, complaints and chargebacks.

A point of confusion: "DDU" is no longer an official Incoterm. It existed in older versions of the rules but was removed in Incoterms 2010 and replaced by DAP (Delivered At Place). DAP means the same thing in practice — the seller delivers to the named place but the buyer handles import clearance, duty and VAT. People still say "DDU" colloquially, but the correct current term is DAP.

DDP, by contrast, remains a current Incoterms 2020 rule and is the only one where the seller bears import clearance and import duties in the buyer's country. Choosing DDP shifts customs complexity onto the seller in exchange for a frictionless buyer experience; choosing DAP/DDU keeps the seller's obligations lighter but risks a poor delivery experience for the customer.