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.

 

DDP – Delivered Duty Paid

             (named Place)

 

FCA –Free Carriage (named Place)

 

 

Costs

Risks

 

 

Costs

Risks

Warehouse services

Seller

Seller

 

Warehouse services

Seller

Seller

Marking and labeling

Seller

Seller

 

Marking and labeling

Seller

Seller

Packing of Goods

Seller

Seller                                   

 

Packing of Goods

Seller

Seller                                   

Loading at Seller’s premises

Seller

Seller

 

Loading at Seller’s premises

Seller*

Seller*

Transportation from Seller’s

premises to Load port

Seller

Seller

 

Transportation from Seller’s

premises to Load port

Seller*

Seller*

Unloading at Loading Port

Seller

Seller

 

Unloading at  Load port

Seller*

Seller*

Loading to Vessel/Aircraft

Seller

Seller

 

Loading to Vessel/Aircraft

Seller*

Seller*

Export documentation

Seller

Seller

 

Export documentation

Seller

Seller

Export Customs Clearance

Seller

Seller

 

Export Customs Clearance

Seller

Seller

Export Taxes and duties (if any)

Seller

Seller

 

Export Taxes and duties (if any)

Seller

Seller

Handling  at Load Port

Seller

Seller

 

Handling  at Load Port

Seller

Seller

Main Carriage

(Ocean Freight/Airfreight)

Seller

Seller

 

Main Carriage

(Ocean Freight/Airfreight)

Buyer

Buyer

Import Customs Clearance

Seller

Seller

 

Import Customs Clearance

Buyer

Buyer

Import Documentation

Seller

Seller

 

Import Documentation

Buyer

Buyer

Import Taxes and Duties (if any)

Seller

Seller

 

Import Taxes and Duties (if any)

Buyer

Buyer

Transportation from destination

port to named place

Seller

Seller

 

Transportation to  final destination

Buyer

Buyer

Unloading at named place

Buyer

Buyer

 

Unloading at  final destination

Buyer

Buyer

 *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  

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