Transportation Operations LINCS Practice Exam

What does 'Delivered Duty Paid' indicate regarding seller responsibilities?

1. Sellers assume no risk after delivery

2. Sellers cover all costs up to the consignor's door

3. Sellers limit their responsibilities to shipping costs only

4. Sellers are only responsible for risk during transportation

The correct answer is: Sellers cover all costs up to the consignor's door

'Delivered Duty Paid' (DDP) is a term used in international shipping that places a comprehensive obligation on the seller or exporter in terms of responsibilities associated with the delivery of goods. When goods are sold under DDP terms, the seller undertakes to cover all costs associated with transporting the goods to the specified destination, which includes not just the shipping charges but also customs duties, taxes, and any other expenses incurred until the goods reach the buyer's door. This means that the seller is responsible for all risks and costs involved in getting the goods delivered, including clearing customs at both the point of origin and destination. The seller essentially assumes full responsibility until the goods are delivered to the buyer's specified location. This level of responsibility is significant, as it provides clarity and reduces the burden on the buyer in international transactions. In contrast, other options suggest limited responsibilities or a focus only on transportation costs, which does not align with the DDP terms. Therefore, the understanding of 'Delivered Duty Paid' highlights the seller's extensive obligations in ensuring that the goods not only arrive safely but also that all associated costs and customs processes are handled by them.