Learning more about Incoterms®2010

Delivered at Place or DAP (named place of destination) Incoterms®2010 is the sixth of eleven Incoterms (it is always plural) for the class “Rules for any Mode or Modes of Transport”, which means that it can be used irrespective of the selected mode of transport and can even be used for more than one mode of transport. According to the International Chamber of Commerce (ICC), DAP means that “the seller delivers when the goods are placed at the disposal of the buyer on the arriving means of transport ready for unloading at the named place of destination. The seller bears all risks involved in bringing the goods to the named place”. As with the earlier Incoterms it is advisable for the contracting parties to clearly specify the point within the agreed place of destination, since the risks to that point are for the seller’s account. Accounting for the seller’s risk, the seller would be well advised to procure a contract of carriage, which is in accordance with the specifications of the contract of sale. The seller is not entitled to recover the costs that he has incurred from the buyer under the contract of carriage with respect to the unloading of the goods at the place of destination, unless mutually agreed with the buyer. The final ICC “Guidance Note” reminds us that under DAP the seller must clear the goods for export, where applicable. The seller has no obligation with respect to the importation and its associate actions. In instances where it is required that the seller clear the goods for import and undertake any import formalities, then the Delivered Duty Paid (DDP) term, the seventh Incoterms, should be used. In next week’s issue we will define Delivered at Place (DAP) – The Seller’s Obligations.