EXW vs DDP – who pays for what?
EXW is Ex Works and DDP is Delivered Duty Paid. We compare who pays for transport, customs clearance and duty, and where risk passes to the buyer.
Key differences
Under DDP, the seller also covers export clearance, transport to the port or terminal, loading for main carriage, the main freight, import clearance, and import duty and VAT. Under EXW, the buyer pays for this instead. The two rules also differ in the point at which risk passes to the buyer.
- Export clearance
- EXWBuyerDDPSeller
- Transport to the port or terminal
- EXWBuyerDDPSeller
- Loading for main carriage
- EXWBuyerDDPSeller
- Main carriage (freight)
- EXWBuyerDDPSeller
- Import clearance
- EXWBuyerDDPSeller
- Import duty and VAT
- EXWBuyerDDPSeller
- Risk passes
- EXWAt the seller’s premises, before loadingDDPAt the place of destination, before unloading
Full cost breakdown
| Cost | EXW | DDP |
|---|---|---|
| Export clearance | Buyer | Seller |
| Transport to the port or terminal | Buyer | Seller |
| Loading for main carriage | Buyer | Seller |
| Main carriage (freight) | Buyer | Seller |
| Insurance | No obligation | No obligation |
| Unloading at destination | Buyer | Buyer |
| Import clearance | Buyer | Seller |
| Import duty and VAT | Buyer | Seller |
| Risk passes | At the seller’s premises (or another agreed place), when the goods are ready for collection – before loading. | At the place of destination, after import clearance, when the goods are ready for unloading. |
| Mode of transport | Any mode of transport (sea, rail, air, road) | Any mode of transport (sea, rail, air, road) |
Notes
- EXW – export clearance: formally the buyer’s responsibility. In practice, the export declaration in China is filed by the supplier or a Chinese customs broker, because a foreign buyer is not registered with customs there.
- Unloading at destination: if unloading costs are included in the contract of carriage concluded by the seller, the seller pays them and cannot charge them to the buyer afterwards.
What to watch for when importing from China
EXW Ex Works
Once the goods are ready for collection, everything else is your responsibility – including loading and export clearance. In China, the export declaration is filed by a company registered with Chinese customs – usually the supplier or a Chinese customs broker – so you will need their help anyway. Agree in writing who loads the goods and who handles export clearance. If the goods are damaged during loading, the loss is yours.
More about EXW →DDP Delivered Duty Paid
The supplier has to act as the importer in Poland: declare the goods for customs clearance and pay duty and VAT. A Chinese supplier is rarely able to do this on its own, so it uses intermediaries. Goods shipped under DDP sometimes do not go through proper import clearance – and it is then the consignee who has a problem with goods that were not legally released for free circulation. With a new supplier, DAP is the safer choice.
More about DDP →When to use EXW and when to use DDP?
- EXW – when you want to control transport right from the factory, and your freight forwarder arranges collection of the goods and export clearance in China.
- DDP – when the supplier is reliable and can legally clear the goods in Poland as the importer, and you want the goods delivered with duty and VAT paid.
Buying on EXW terms? You choose the forwarder
We organise transport from China – by rail, sea or air – together with customs clearance in Poland and cargo insurance. Send us your cargo details and we will prepare a quote tailored to your shipment.
Request a quoteFAQ
What is the main difference between EXW and DDP?
Under DDP, the seller also covers export clearance, transport to the port or terminal, loading for main carriage, the main freight, import clearance, and import duty and VAT. Under EXW, the buyer pays for this instead. The two rules also differ in the point at which risk passes to the buyer.
Where does risk pass to the buyer under EXW?
At the seller’s premises (or another agreed place), when the goods are ready for collection – before loading.
Where does risk pass to the buyer under DDP?
At the place of destination, after import clearance, when the goods are ready for unloading.
Can EXW and DDP be used for rail freight from China?
Yes. EXW and DDP can be used with any mode of transport: sea (including containers), rail, air and road.
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Incoterms® is a registered trademark of the International Chamber of Commerce (ICC). This page is an independent, simplified summary of how costs and risks are divided – it is not affiliated with or approved by the ICC. When drafting contracts, use the official text of the Incoterms® 2020 rules published by the ICC.