Incoterms: What Delivered-at-Place (DAP) means for importers | Vince Barnes & Rob Naumovski

Intergroup Australia's Managing Director Vince Barnes & Freight Manager Rob Naumovski took some time out to discuss what the "Delivered-at-Place" (DAP) Incoterm rules imply for Australian Exporters and Importers of goods.
We often encounter businesses that mistake Incoterm rules when shipping their goods, so this video is intended to clarify the, often subtle, but important differences between DAP and other Incoterm methods of carriage.

Delivered-at-Place (DAP) Incoterm specifies a trade wherein the seller of goods bears the responsibility and cost of transporting them to a destination specified in the contract.

The Consignor (Seller) is liable to pay for potential losses arising in transit. In DAP import terms, the Consigneee (Buyer) or the importer of the goods must pay for customs duty, import tariffs, local taxes and unload the goods.
Separate marine insurance policies are also recommended as Vince outlines at 8:00 mins as General Average regulations can have a huge negative affect on Buyers in the event of shipping accidents.

At 4:45 mins, Robert outlines an example of how a client who imports office furniture under DAP had not considered the type of vehicle required to deliver their goods to their warehouse - it had been incorrectly assumed by the seller.
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The International Chamber of Commerce (ICC) established Incoterms in 1936 to promote open markets and ensure global economic prosperity through trade.
Essentially, Incoterms are a set of guidelines that help Buyers (Consignees) and Sellers (Consignors) by providing a common language that can be used to set terms of trade.
Activities that call for the use of Incoterms include; filling out purchase orders, labeling shipments for transport, and completing certificates of origin.
Incoterms are updated periodically to conform to changing trade practices.

To note:

Incoterms do not preclude contracts, insurance and other liability agreements, but they do, however, allow logistics experts to speak in shorthand to get goods from location to location in the most business appropriate way.

Incoterms do not :
-address all sale conditions
-Specify customs clearance processes
-Identify the goods being sold
-Reference the methods or timings of payments
-Address liability for contract failures
-Determine when the title, or ownership of the goods, passes from the seller to the buyer

Incoterms omit certain sale conditions, so all parties involved in any contract should make sure to address the above conditions contractually.

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*Intergroup Australia advises all information contained in this video is general in nature and should not be considered to be formal, legal, consulting or professional advice.