Delivered at Place Unloaded (DPU) Incoterm 2020 for freight shipping
DPU is short for Delivered at Place Unloaded, and it is one of the 11 Incoterms created by the ICC to ease international trade. The DPU Incoterm from 2020 was formerly known as Delivered at Terminal (DAT), and it was updated in 2020 to be more comprehensible. Learn about the changes to the DAT Incoterm in 2020 and how the DPU shipping terms and prices work. Get ready to ship your cargo more efficiently.
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Delivered at Place Unloaded Incoterm 2020: Definition
Formerly known as Delivered at Terminal, the DPU Incoterm in 2020 determines the responsibilities of the seller and buyer for international trade. DPU shipping terms can be used for all types of transport, including intermodal freight.
When using DPU shipping terms, the seller and buyer should agree on the destination place, which can be a port, hub, buyer’s premises or any other place.
The seller is responsible for arranging export clearance, freight transport, and loading and unloading of the goods at a designated point in the country of destination. The DPU shipping term is the only Incoterm that requires the seller to unload the goods at the country of destination. After the goods are unloaded, the risk transfers from the seller to the buyer. When using the DPU Incoterms from 2020, the buyer is responsible for import duties in the country of destination, as well as any last-mile deliveries and warehousing fees after the cargo is delivered.
SHIPPING COSTS
Shipping under the DPU Incoterm: Costs for seller and buyer
When using the DPU Incoterm, the price paid by the seller includes export duties, freight transport charges, and loading and unloading of the merchandise at the designated point of delivery. The buyer will have to pay for import duties and clearance, as well as any last-mile deliveries from the designated unloading point.
DPU Shipping: Costs for the seller
- Packing and labelling the cargo
- Preparing the cargo for inspection
- Clearing the goods for export and paying any taxes, duties and fees at the country of origin
- Loading the cargo on the vessel and paying the transport fees
- Destination terminal handling charges
- Delivering and unloading the cargo to the designated destination
DPU Shipping: Costs for the buyer
- Import clearance, duties and taxes in the country of destination
- Any last-mile deliveries and transport from the designated point
Example of DPU in international deliveries
For example, an Irish company sells 100,000 units of merchandise to a US company under the DPU shipping terms. The US company designates their warehouse in Virginia as the designated location.
- The Irish company clears the goods for export and arranges transport from their address in Ireland to the port in the US. The seller pays for loading the goods, transport fees and export duties.
- Once the goods arrive at the port of destination in the US, the US company pays for the import clearance.
- Once the goods are cleared, the seller books a local freight forwarder to transport the goods from the port to the warehouse in Virginia.
- The Irish company pays to unload the goods from the truck at the warehouse.
- The US company gets the goods and pays for warehousing and deliveries to their clients.
DPU vs DAT: changes made to DAT Incoterms in 2020
DAT shipping terms were updated in 2020 to be more efficient and cover different means of transport. Delivered at Terminal established the terminal as the only possible designated unloading point, whereas DPU 2020 allows the buyer to designate any location at their convenience. This makes the Delivered at Place Unloaded much more general than Delivered at Terminal. When shipping under the DPU Incoterm, delivery can occur in any location, be it a warehouse, a terminal or a roadside.
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What does DPU mean in logistics? DPU 2020 FAQ
Does the DPU price include customs duties?
When shipping under the DPU Incoterm, the final price includes all costs up until the cargo arrives at the country of destination. This means that the seller pays export duties. The only extra costs not covered in a DPU delivery are all import permits, duties and taxes, including VAT, as well as deliveries, last-mile logistics and warehousing after the goods have been unloaded at the designated location. The buyer is responsible for paying import duties and clearing the goods in the country of destination.
Who pays for insurance when using DPU shipping?
Under DPU shipping terms, there is no obligation on either party to purchase insurance. Nevertheless, the seller may want to buy insurance as they carry the risk of the goods until they are unloaded at the designated address. The seller is not obligated to do so, and if the buyer wants the goods covered, they might want to purchase insurance themselves. To avoid any inconvenience, both parties should agree beforehand on the insurance.
What is the difference between DPU and DAP Incoterms?
Delivered at Place Unloaded from 2020 copies the Delivered at Place (DAP) Incoterm with the only difference that the seller delivers and unloads the goods at the designated location. When shipping under the DAP, the buyer is responsible for unloading the cargo at the destination location.
Can I use the DPU shipping term for containerised cargo?
Yes, the ICC recommend using DPU shipping for containers. The DPU Incoterm from 2020 is suitable for sellers with a strong position in the country of origin, as they will have to carry all the export paperwork and duties.
What happens if the goods are held up in customs when using DPU shipping terms?
One of the main disadvantages of Delivered at Place Unloaded is that while the seller is responsible for unloading the goods, the buyer must clear the goods for import. This means that if the seller does not provide the correct documents or there is a missing form, the buyer may have to cover the occurring expenses. These problems can be avoided by double-checking every document and preparing all forms beforehand.