Compare between DAP and FOB rules for delivery

FOB and DAP under Inco terms 2020

Delivered at Place to a named place (DAP) and  Free On Board  at named place FOB are the two of eleven delivery rules for movement of goods under Incoterms 2020.

Let us discuss here the difference between both DAP and FOB delivery terms under Inco terms

First of all, FOB rule is meant for movement of goods on waterways, as it is known as Marine restricted mode of transport whereas DAP rule may be used for movement of goods by Air, Sea or Land.

Secondly, the named place to deliver goods under DAP is in buyer’s side whereas under FOB, the named place to deliver goods is in Seller’s country. 

Under FOB rules, the seller discharges his obligation on costs and risks under movement of goods when goods are gone on board the vessel at seller’s side.  However under DAP rules, the seller is responsible for movement of goods till the named place mentioned at buyer’s side.

Another difference between DAP and FOB is; compared to FOB terms, higher risks and costs are involved for a seller under DAP terms, as he is responsible for main carriage and on carriage. 

Under a contract of carriage DAP; since the control over main carriage is with the seller, the buyer depends up on the seller to get export movement data.  However, under FOB rules, the buyer pays ocean freight and he holds the control over main carriage in turn can obtain vessel movement data from shipping carriers or his agent easily.

Under FOB terms, since the buyer controls over the ocean freight, the seller does not have responsibility to release Bill of Lading.  However, the buyer and seller mutually agree and buyer arranges to instruct carrier of goods or his agent to allow seller to release BL and in turn he sends to buyer through his bank, if original BL required by the buyer.

 You may read about FOB and DAP separately in this website, you may click below to read:

FOB  Free On Board

DAP  Delivered at Place

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