[TIPS] Why DDP Can Create Hidden Import Risk

Host: Lalo Solorzano and Trudy Wilson
Published: May 13, 2026
Length: 13:22
Presented by: Global Training Center

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Summary

In this episode of Simply Trade, Lalo Solorzano welcomes back Trudy Wilson for another round of Trudy’s Trade Tips, continuing the conversation on Incoterms that deserve extra caution. After previously covering Ex Works, Trudy turns to the opposite end of the spectrum: DDP, or Delivered Duty Paid.

At first glance, DDP can sound like the easiest option for buyers because the seller appears to handle everything. But as Trudy explains, that convenience can come with serious compliance risk. Whether you are the seller taking responsibility for import requirements in another country, or the buyer relying on a foreign supplier to correctly manage customs clearance, DDP can create unexpected exposure.

The discussion breaks down why importers must stay alert to documentation, classification, tariffs, antidumping and countervailing duties, broker setup, and country-specific import rules. Trudy also explains why sales teams may love DDP from a customer service perspective, but compliance teams should take a closer look before agreeing to it.

This episode matters because Incoterms are not just shipping terms. They affect cost, risk, responsibility, and compliance exposure.

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Main Topic / Discussion

This episode focuses on the risks of using DDP, Delivered Duty Paid, in international transactions. Trudy explains that DDP places maximum responsibility on the seller, including transportation, costs, risk, and import compliance into the destination country.

For sellers, DDP may mean taking on import obligations in a country where they may not understand the rules or may not even be legally permitted to act as the importer. For buyers, DDP may seem convenient, but it can create risk when a supplier misclassifies goods, undervalues shipments, fails to account for tariffs, or does not properly set up broker authority.

Trudy also emphasizes that companies should not assume a freight forwarder or broker has the same capabilities in every country. Service provider coverage, local representation, and destination-country expertise are essential when considering any complex import transaction.

The episode closes with a practical reminder: companies can often simplify Incoterm decisions by focusing on a smaller group of more practical terms, while still getting proper training before applying them.

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Key Takeaways

• DDP may sound convenient, but it can create major compliance exposure for both buyers and sellers.
• Sellers using DDP may become responsible for import rules and requirements in the destination country.
• Some countries do not allow foreign entities to complete DDP transactions unless they have the proper local presence.
• Buyers should not assume a supplier will correctly manage classification, valuation, tariffs, or duty requirements.
• Even if a buyer is listed only as the ultimate consignee, they may still be tied to the import transaction.
• Companies should verify broker setup, documentation, data elements, and service provider capabilities before agreeing to DDP.
• Trudy recommends staying away from DDP whenever possible and focusing on more practical Incoterms when appropriate.

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Resources & Mentions

• Global Training Center
• TruTrade Solutions

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Credits

Host:
Lalo Solorzano – LinkedIn
Trudy Wilson – LinkedIn

 

Producer:
Lalo Solorzano

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