FOB vs DPU – who pays for what?
FOB is Free On Board and DPU is Delivered at Place Unloaded. We compare who pays for transport, customs clearance and duty, and where risk passes to the buyer.
Key differences
Under DPU, the seller also covers the main freight and unloading at destination. Under FOB, the buyer pays for this instead. The two rules also differ in the point at which risk passes to the buyer and in the mode of transport. FOB applies only to sea and inland waterway transport.
- Main carriage (freight)
- FOBBuyerDPUSeller
- Unloading at destination
- FOBBuyerDPUSeller
- Risk passes
- FOBOn board the vessel at the port of loadingDPUAt the place of destination, after unloading
- Mode of transport
- FOBSea onlyDPUAny
Full cost breakdown
| Cost | FOB | DPU |
|---|---|---|
| Export clearance | Seller | Seller |
| Transport to the port or terminal | Seller | Seller |
| Loading for main carriage | Seller | Seller |
| Main carriage (freight) | Buyer | Seller |
| Insurance | No obligation | No obligation |
| Unloading at destination | Buyer | Seller |
| Import clearance | Buyer | Buyer |
| Import duty and VAT | Buyer | Buyer |
| Risk passes | At the port of loading, when the goods are on board the vessel. | At the place of destination, after unloading. |
| Mode of transport | Sea and inland waterway transport only | Any mode of transport (sea, rail, air, road) |
What to watch for when importing from China
FOB Free On Board
A common mistake: FOB for rail or air freight. FOB applies only to sea and inland waterway transport. For rail freight from China, the right rule is FCA with the name of the terminal (e.g. “FCA Xi’an, rail terminal”), and for air freight, FCA with the name of the airport. Under FOB, the supplier pays for export clearance and the charges at the port of loading – check that they are not added to the invoice separately.
More about FOB →DPU Delivered at Place Unloaded
This is the only rule under which the supplier unloads the goods at your premises. The supplier therefore needs someone on site to arrange this, and the place must allow unloading. It is rarely used for imports from China. Import clearance, duty and VAT are your responsibility.
When to use FOB and when to use DPU?
- FOB – for sea freight, when the supplier delivers the goods to a port in China and handles export clearance, while your freight forwarder arranges the freight to Europe.
- DPU – when the supplier is to deliver and unload the goods (e.g. at a terminal or warehouse), and you handle import clearance.
Buying on FOB 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 FOB and DPU?
Under DPU, the seller also covers the main freight and unloading at destination. Under FOB, the buyer pays for this instead. The two rules also differ in the point at which risk passes to the buyer and in the mode of transport. FOB applies only to sea and inland waterway transport.
Where does risk pass to the buyer under FOB?
At the port of loading, when the goods are on board the vessel.
Where does risk pass to the buyer under DPU?
At the place of destination, after unloading.
Can FOB and DPU be used for rail freight from China?
Only DPU. DPU works with any mode of transport, while FOB applies only to sea and inland waterway transport. That is why FOB is not used for rail freight from China.
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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.