Compare between FCA and DDP

DDP Vs.FCA under Inco terms of delivery 2020

How to differentiate DDP with FCA under delivery rules of incoterms 2020?

As you know, DDP means Delivered at a named place goods unloaded and  FCA means Free carriage of cost and risk to a named location.   

As name indicates, under DDP, the exporter delivers goods to Importer’s  named place by  undertaking  pre carriage, main carriage, export customs clearance, on carriage, import customs clearance and duties.  Whereas under FCA, the exporters transfers his risks and costs of movement of goods to importer immediately upon goods are gone onboard the main carrier, either on the vessel, aircraft or other means. 

The exporter or his nominated agent should have a sound experience and knowledge about the import customs clearance and tax regulations of buyer’s country and transportation risks and costs to handle DDP term of delivery.  Since the costs and risks to deliver goods ends at seller’s country under FCA terms of delivery, the seller  does not want to be familiar with  the  government regulations, on carriage and import tax related experience and knowledge.

Under FCA terms, the seller’s risks and costs transfer to buyer at seller’s country.  But the costs and risks transfers from seller to buyer in buyer’s country under DDP delivery rules as per Incoterms 2020

Under DDP, main carriage is undertaken by Exporter, but under FCA the said main carriage is under the risk of Buyer.

The seller is responsible for Import customs clearance and taxes if any in importing country under DDP delivery rules.  However, the Seller completes his responsibility on risks and costs and passes to buyer, once goods delivered to vessel in Seller’s country under FCA terms.

Again under DDP terms, the seller is responsible for on carriage of goods to buyer’s named place agreed whereas under FCA, on carriage to buyer’s premises is under buyer’s risks and costs.

Under DDP terms, the exporter holds the control over export documentation, import documentation, pre carriage, and main carriage and on carriage, imports customs regulations process and import duties.  So the importer needs the support of exporter for all EGM, IGM and other export and import data related to the said shipment.  But under FCA, since the main carriage, import customs process and taxes and on carriage is handled by the importer, he has control over such activities except export data.

 *FCA diagram shown above is meant for movement of goods for exports,  wherein named place is Port of loading.   FCA delivery term means loading goods to the means of transport provided by the buyer or placing them at the disposal of the buyer’s carrier.  Read the separate post about FCA in this website for better understanding.

The meaning and complete explanation about DDP and FCA are explained separately in this website and you may click below to read in detail:

DDP  Delivered Duty Paid

FCA  Free Carrier

The above information is about FCA and DDP and its differences.   You may add more information about this subject on FCA and DDP, share below your thoughts and experience in handling FCA and DDP.

Click here to read other delivery rules under Inco terms  

Learn practical problems and solutions in Exports and Imports

Banking rules related to Exports and Imports in India

How to open Letter of Credit, easily explained here

Is it necessary to use trade mark of Incoterms under Sale contract     Mention year of Inco Terms under Sale contract     Inco Terms and Sale Contract between buyer and seller     Inco Terms 2020 Rules for Delivery of Goods         Buyer or Seller? Who pays Insurance under DAP Inco terms?         Under FCA Inco terms, Insurance is paid by buyer or seller?     Under EXW Ex works, who arranges Insurance?     04 Categories of Inco Terms 2020     D Category of Delivery terms under Incoterms 2020     CIP terms of movement, Unloading goods by Buyer or Seller?        C Rules of Delivery terms under Incoterms 2020       F Rules of Inco Terms 2020E Category of Incoterms 2020     Omni Model Inco Terms of Delivery 2020     FOB and CFR under Inco terms 2020