International Commercial Terms (Incoterms) are pre-determined trade terms of ICC to describe the mode of delivery of goods and the roles of importers and exporters in the process. Both buyers and sellers in global trading should acknowledge them during transactions.
As one of the Incoterms, DAT used to be referred to as DES (Delivery at Ship) and DEQ (Delivery at Quay) in the year 2000. However, effective from January 2020, DAT has been renamed to DPU, i.e., Delivery at Place Unloaded.
However, the changes were only made to capture the full essence of the term as accurately as possible. Thus, the terms of the agreement are still binding.
Table of Contents
How does DAT work?
What are the peculiarities of DAT?
What are sellers’ obligations under DAT?
What are buyers’ obligations under DAT?
What is the difference between DAT vs DAP?
How does DAT work?
Transaction under the DAT term implies that the seller will deliver the goods to a location or terminal, such as a port, a quay, container yard, warehouse, or road transport hub. Both parties must pre-determine and include the terminal in the agreement.
After delivery, the buyer assumes full responsibility for the goods, including import formalities and inland logistics.
During this process:
The seller covers all expenses before delivery (including terminal handling charges).
The buyer covers all expenses after delivery (customs duties, clearance, taxes, domestic transportation, etc.).
Since all liabilities transfer from the seller to the buyer at the final delivery point, both parties must clearly agree on the exact delivery terminal in the contract.
DAT also shares certain similarities and differences with other Incoterms such as DAP and DPP, which will be discussed below.
Case Study
A Canadian buyer purchases automobile spare parts from China under the DAT term, with delivery set at a Canadian terminal facility.
The Chinese seller clears the goods through customs at the port of origin and pays for carriage and insurance until safe delivery in Canada.
After unloading at the Canadian port, responsibility and risk transfer to the buyer, who then completes onward transport and handling.
What are the peculiarities of DAT?
Sellers or suppliers take responsibility for transporting goods from origin to the delivery terminal.
Buyers handle import charges and transport to the final intended location.
Risk transfers from seller to buyer upon delivery at the destination terminal.
Advantage and drawback of DAT for buyers
Buyers benefit from guaranteed delivery to the agreed terminal and can focus on the remaining clearance and forwarding.
However, they assume the risk of damage or loss when reloading or transporting goods to the final destination.
Advantage and drawback of DAT for sellers
Sellers only need to ensure delivery to the terminal, making their responsibility relatively simple.
However, the buyer may fail to take delivery as agreed, causing potential complications.
What are sellers’ obligations under DAT?
1. Licensing
Sellers must obtain any required export licenses or authorizations in the country of origin to ensure legal export.
2. Delivery and unloading of goods
Sellers must deliver and unload goods at the agreed terminal, providing necessary documents such as invoices and proof of delivery.
3. Transportation and insurance
Sellers must arrange transportation to the destination terminal and may need to secure insurance to cover potential incidents.
4. Costs (fees and levies)
Sellers must cover all transport-related costs including loading at origin, export clearance, carriage, and unloading at the destination terminal.
5. Notice to buyer
Sellers must notify the buyer once goods have been delivered to the agreed terminal.
6. Checking
Sellers must inspect, measure, count, package, and label goods to ensure proper shipment.
What are buyers’ obligations under DAT?
1. Payment
Buyers must make payment as agreed in the contract, including all import fees, duties, and taxes.
2. Licenses, authorization, and formalities
Buyers must obtain any necessary import permits or documents to complete the delivery process.
3. Shipping and insurance
While sellers cover these before delivery, buyers should still monitor the process.
4. Taking delivery
Buyers must receive the goods at the agreed terminal and time.
5. Transfer of risks
All risks transfer to the buyer once goods are unloaded at the terminal.
6. Notice to the seller
Buyers should notify the seller of receipt, confirming delivery and validating documentation.
What’s the difference between DAT vs DAP?
DAP (Delivered at Place) means the seller handles all costs to transport goods to a named location outside the terminal.
DAT means delivery occurs at the terminal.
Comparison:
DAT
Delivery point is the port or terminal
Seller covers losses before delivery; buyer covers losses after delivery
DAP
Delivery point is a named location outside the facility
Seller covers losses until final delivery location
Thus, the key difference is the delivery point. Under DAT, buyers must arrange transport from the terminal to the final destination; under DAP, they simply wait for delivery at their specified location.
Final words
Above is the basic knowledge of the Incoterm DAT explained. Feel free to leave a comment below if you have any questions.
We are irenesourcing, a sourcing company in China committed to helping business owners import products from China at competitive prices. If you need help with customizing, wholesaling, or shipping your products from China, please don’t hesitate to CONTACT US.
