EXW, FOB, DAP or DDP? Incoterms for shipping to the USA

What an Incoterms rule decides, and what it does not

Incoterms rules are three-letter trade terms published by the International Chamber of Commerce (ICC). The current edition, Incoterms 2020, has eleven rules. ICC groups them into seven rules for any mode or modes of transport (EXW, FCA, CPT, CIP, DAP, DPU, DDP) and four rules for sea and inland waterway transport only (FAS, FOB, CFR, CIF), as set out in the Incoterms 2020 introduction.

When you write “FCA Shenzhen, Incoterms 2020” or “DDP Ontario, California, Incoterms 2020” in a contract, you settle three things between seller and buyer:

• Delivery and risk: the point where the seller has delivered and loss or damage becomes the buyer's risk.
• Costs: which party pays for each leg, from loading at origin to unloading at destination.
• Formalities: who handles export clearance in the origin country and import clearance in the U.S., including duties.

An Incoterms rule does not decide when ownership passes, how or when you get paid, or which law applies. Your sales contract and payment terms do that. It also does not bind carriers, forwarders or U.S. Customs and Border Protection (CBP). CBP deals with the importer of record named on the entry, whatever the invoice says.

Always name a precise place after the rule. “FOB China” or “DDP USA” is not enough to price a shipment or settle a dispute. “FOB Ningbo” or “DAP buyer's warehouse, 123 Example Road, Ontario, California” is.

The main rules used for U.S. imports

Most U.S. import contracts use one of the eight rules in the table below (CFR and CIF share a row). CPT and CIP work like CFR and CIF but for any mode, and FAS is rare outside bulk cargo, so they are left out of the table.

Two details trip people up. Under CFR and CIF the seller pays freight to the U.S. port, but risk passes at the origin port, so a container lost at sea is the buyer's problem and the buyer's insurance claim. And under CIF the seller only has to buy minimum cover (Institute Cargo Clauses C), while CIP requires the higher Institute Cargo Clauses A level, according to ICC's summary of the 2020 changes. If you buy CIF, check whether that cover is enough or insure the cargo yourself.

DPU replaced the old DAT rule in 2020. The difference from DAP is simple: under DAP the seller does not unload the goods at destination, under DPU the seller does. For a container delivered to a U.S. warehouse, decide in advance who pays for unloading, because the warehouse will charge someone.

EXW vs FOB vs FCA: the origin-side choice

When a U.S. buyer arranges the freight, the choice is usually between EXW, FOB and FCA. All three leave the main carriage, U.S. import and duties with the buyer. They differ at origin.

EXW

The seller makes the goods available at its own premises and does nothing else: it does not load the truck and it does not clear the goods for export. That looks simple, but the buyer, often based in another country, becomes responsible for the export declaration in the seller's country. In many countries only a locally registered company can file it, and the exporter shown on the export record has to match. If your buyer cannot do this, EXW creates a paperwork gap right at the start.

FOB

The seller clears the goods for export and delivers them on board the vessel the buyer has booked. FOB is a sea and inland waterway rule. It fits bulk or break-bulk cargo loaded directly over the ship's rail. For containers, the seller normally hands the box to the carrier at a container terminal or freight station days before it is loaded, and from that moment it cannot control what happens to it, yet under FOB it still carries the risk until the box is on board.

FCA

The seller clears the goods for export and hands them to the buyer's carrier at a named place: its own warehouse (loaded onto the buyer's truck), a container freight station or a terminal. FCA works for any mode, including air and truck. Incoterms 2020 also lets the parties agree that the buyer instructs its carrier to issue an on-board bill of lading to the seller, which helps when a bank requires one under a letter of credit (ICC).

In practice: for containerized ocean freight, air freight or courier, FCA is usually a better fit than FOB, and FCA at the seller's premises is usually a better fit than EXW when the buyer cannot clear goods for export in the seller's country.

DDP shipping to the USA needs an importer of record

Under DDP the seller carries everything up to the named place in the U.S., including U.S. import clearance, duties and import charges. For a foreign seller, that means someone has to act as the U.S. importer of record (IOR) for the seller's goods: the party that declares them to CBP, is responsible for classification, value and origin, and owes the duties.

A DDP quote is only as good as the answer to one question: who is the importer of record? If the seller says DDP but expects the buyer's company to appear as importer on the entry, the shipment is really DAP with duties reimbursed, and the buyer carries the customs liability it thought it had avoided.

Non-resident importers of record under current rules

A company without a U.S. entity can act as its own IOR. Under 19 CFR 141.18, a nonresident corporation may enter goods for consumption only if it has a resident agent authorized to accept service of process in the state where the port of entry is located, and it files a customs bond (CBP Form 301) backed by a resident corporate surety. The entry itself is usually filed by a licensed customs broker on behalf of the importer of record.

The importer also needs an IOR number registered with CBP on Form 5106. In a general notice of August 19, 2026, CBP said that from September 18, 2026 it may immediately void IOR numbers whose Form 5106 data is inaccurate or incomplete. The physical address must be the importer's actual location, not a registered agent, customs broker, freight forwarder or P.O. box, and the broker must hold a power of attorney signed directly with the importer.

What Executive Order 14411 changes

Executive Order 14411, Strengthening Customs Enforcement, signed June 3, 2026, directs DHS and CBP to separate U.S. importers of record from foreign ones and tighten the rules for foreign IORs. Among other things, it directs CBP to:

• prohibit foreign IORs from filing informal entries;
• require that, for formal entries, a foreign IOR not rely on a continuous bond except as CBP permits, and either be validated in CTPAT (if eligible) or use a CTPAT-validated licensed customs broker;
• within 180 days, require all importers of record, not only foreign ones, to maintain a minimum level of tangible U.S. assets, bonding or both.

These foreign IOR restrictions are directed but not yet in force as of October 2026; check the current rules before you quote or accept DDP terms. So far CBP has carried out only parts of the order, such as the importer data notice above.

For a foreign seller, all of this makes DDP harder than it looks on a price list. Abanro handles U.S. customs clearance as part of your shipment, and in eligible cases Abanro can act as importer of record. Whether a shipment is eligible depends on the product, the paperwork and the rules in force when it arrives, so raise it at the quote stage, not when the goods are on the water. For the full sequence of steps, read how U.S. customs clearance works for foreign businesses.

Who pays U.S. duties, fees and destination charges

Under every rule except DDP, the buyer pays U.S. duties and import charges. Under DDP the seller does. That much is clear. The arguments start with the charges in between.

• Duties: set by the product's classification in the Harmonized Tariff Schedule, its country of origin and any additional duties in force when it enters (as of October 2026, Section 301 and Section 232 duties apply to many goods, so check the HTS and current CBP guidance for yours). They are paid by the importer of record, so the party who is IOR must have the money ready before release.
• CBP fees: such as the merchandise processing fee and, for ocean cargo, the harbor maintenance fee. They follow the duties.
• Destination port and terminal charges: under CFR, CIF, DAP and DPU, the seller's freight contract may or may not include destination terminal handling. Whatever is not included usually ends up with the buyer. Ask the seller for a written list of what its freight price covers.
• Exams and holds: if CBP or another agency examines the cargo, the examination station and the parties moving the goods bill their charges to the importer side. Under DDP that is the seller.
• Storage, demurrage and detention: charged when containers or cargo are not picked up or returned in time. They fall on whoever controls the shipment at that point, which is why the named place matters. Our guide to drayage, demurrage and detention at Los Angeles and Long Beach explains these charges.

To compare offers under different rules, put every cost on the same basis: delivered to the same U.S. address, duties paid. The guide to the cost of importing products into the USA lists each component.

Common mistakes with Incoterms on U.S. shipments

• Using EXW when the buyer cannot file the export declaration. The goods sit at the factory or the origin port while you work out who can declare them. Use FCA at the seller's premises instead.
• Using FOB for air, truck or courier shipments. FOB is a sea and inland waterway rule. For other modes, use FCA (buyer arranges carriage) or CPT, CIP, DAP or DDP (seller arranges carriage).
• “DDP” quotes that exclude duties. Some quotes say DDP but note “duties and taxes billed at cost” or “excluding customs charges”. That is not DDP. Ask for a written confirmation of what is included and who will be importer of record.
• No named place, or the wrong one. “DAP Los Angeles” could mean the port or a warehouse 60 miles inland. Name the full delivery address.
• Assuming the Incoterms rule decides the ISF. The Importer Security Filing for ocean cargo is due no later than 24 hours before loading at the foreign port under 19 CFR 149.2, whatever rule you use. Under FOB or FCA the buyer's side files it but needs data from the seller.
• Forgetting who pays to unload. Under DAP the buyer unloads, under DPU the seller does. A floor-loaded container can take hours to unload.
• Mixing up price terms and delivery terms. A price list “FOB factory” is not a valid Incoterms rule. Quote and contract with the same rule and place.

Which rule fits a first shipment to Amazon or a U.S. buyer

The right rule depends less on preference than on two questions: who owns the goods when they arrive, and who can act as the U.S. importer of record.

Shipping your own stock to Amazon or a U.S. warehouse

If you are the seller and the goods stay yours after arrival, there is no U.S. buyer to share responsibilities with. An Incoterms rule matters only between you and your own supplier, or between your foreign company and a U.S. affiliate. What matters for customs is who acts as importer of record and who pays duties. An Amazon fulfillment center is a delivery address, so another party still has to clear the goods first. Many sellers ship to a U.S. receiving partner first, where goods are checked and prepped before they go on to Amazon. Our guides on importing and selling on Amazon USA without a U.S. company and sending inventory to Amazon FBA from overseas cover that route.

Selling to a U.S. importer or distributor

An established U.S. importer usually prefers FCA or FOB, because it has its own forwarder, bond and customs broker. Offer FCA at your warehouse or a named port for containers, and confirm who files the ISF.

Selling to a U.S. retailer, boutique or first-time buyer

Smaller U.S. buyers often do not want to import at all. They want a delivered price. DAP with the buyer as importer of record is the simplest delivered option when the buyer can take on the import. DDP is the most attractive offer, but only quote it once you know who will be importer of record and you have a firm duty estimate for the product.

How Door to Door service relates to your Incoterms rule

The Incoterms rule is an agreement between seller and buyer. A Door to Door logistics service is a separate agreement between whoever books it and the logistics provider. The two should match, but they are not the same thing.

• EXW or FCA: the buyer books the service. Pickup happens at the seller's warehouse, and the buyer's side carries the U.S. import.
• CFR, CIF, DAP or DPU: the seller books carriage to the named port or place. The U.S. import, duties and any leg beyond the named place belong to the buyer, so both sides need to know where the seller's booking ends.
• DDP: the seller books the whole chain, including U.S. customs clearance, and must have an importer of record arranged.

Abanro's pickup and international shipping service covers pickup at the warehouse abroad, ocean or air freight, U.S. customs clearance and delivery from our facility in Orange County, California, near the Ports of Los Angeles and Long Beach. Goods can go through receiving and inspection before they move on to a buyer or Amazon. When you request a quote, tell us the Incoterms rule and named place you agreed, so the scope of the shipment matches who pays for what. Duties, taxes and government charges are billed separately at actual cost to the party responsible for them.

If your goods are in containers, the next decision is usually whether to ship a full container or share one: see FCL vs LCL to the U.S. West Coast. For a handful of cartons, read how to ship your first 100 products to the USA without a container.

This guide is general information, not legal or customs advice. Incoterms rules are published by ICC, and customs rules for importers of record are changing in 2026, so confirm the terms and current requirements for your shipment before you agree them.

Sources and further reading

1. Incoterms® 2020: key changes (FCA, DPU, CIP and CIF insurance), International Chamber of Commerce
2. Incoterms® 2020 Introduction: rules for any mode and rules for sea and inland waterway transport, International Chamber of Commerce
3. 19 CFR 141.18: Entry by nonresident corporations, Legal Information Institute, Cornell Law School (Code of Federal Regulations)
4. Executive Order 14411, Strengthening Customs Enforcement (91 FR 35125, June 10, 2026), Federal Register
5. Accuracy of Importer of Record Data Submitted to CBP (general notice, August 19, 2026), U.S. Customs and Border Protection, Federal Register
6. 19 CFR 149.2: Importer Security Filing requirement and timing, eCFR

Sources checked on October 20, 2026