What does 'Delivered Ex Ship - DES' mean

Delivered ex ship (DES) is a trade term requiring the seller to deliver goods to a buyer at an agreed port of arrival.

BREAKING DOWN 'Delivered Ex Ship - DES'

Delivered Ex Ship is one type of international trade contract. Contracts involving international transportation often contain abbreviated trade terms that describe matters. It includes details like the time and place of delivery, payment, when the risk of loss shifts from the seller to the buyer, and who pays the costs of freight and insurance.

Delivered Ex Ship and Incoterms

The most commonly known trade terms are Incoterms, which is short for "international commercial terms". They are published by the International Chamber of Commerce (ICC), an organization aiming to foster trade and commerce internationally, and promote and protect open markets for goods and services. Incoterms are often identical in form to domestic terms (such as the American Uniform Commercial Code), but have different meanings. As a result, parties to a contract must expressly indicate the governing law of their terms.

Delivered Ex Ship, Step by Step

Typically, the seller remains responsible for the goods until they are delivered, and bears the costs and risks that come with bringing goods to port. That means that the seller has total responsibility while the good is being shipped, and must pay the shipping company, and buy insurance for the good they're shipping. The seller's obligation ends when they deliver the good to the agreed upon port, aboard the ship, not cleared for import. Buyers are responsible for all costs to receive and unload the goods, and clear them through customs.

Delivered Ex Ship, Delivered Ex Quay, Ex Works

Delivered Ex Ship is a trade term that differs from Delivered Ex Quay (DEQ) and Ex Works (EXW). While Delivered Ex Ship stipulates that the seller has a legal obligation to deliver the goods to port, and to insure the goods' arrival there, but not to a wharf, Delivered Ex Quay specifies that the seller must deliver the goods to the wharf at the destination port. Delivered Ex Quay can be noted as having duty paid or unpaid, too. If it is paid, then the seller is obligated to cover costs, like duties, and is responsible for delivering the goods. If unpaid, those obligations and responsibilities shift to the buyer. In Ex Works, the seller must make the goods available for pickup at their place of business. From there, all costs and risks of transportation are taken on by the buyer.

It's important to realize that because this is a legal term, its exact definition is much more complicated and differs by country. It is suggested that you contact an international trade lawyer before using any trade term.

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