Importing from China - Unexpected Origin Charges (DDU shipping)

[GrahamH]

I've recently imported some goods from China by sea. I agreed DDU terms with my supplier & paid for 50% of the goods upfront (other 50% to be paid on the delivery).

I have just received the quote from the UK based freight forwarder/customs agent (that's been working my suppliers Chinese based logistics firm). They've tried to bill me for "expenses at origin" charges, which from my understanding I shouldn't be paying under my DDU terms. Is this thinking correct?

When I've queried this with my supplier he isn't being particularly useful & is denying that this charge is from the Chinese port. This disagreement now means that the stock is currently stuck (soon to incur storage charges)

At this point I am thinking should I just pay this charge now to get the goods going & settle up/deduct when paying the other 50% of the bill. Any advice on whether this is a sensible approach or if there is a better route to take would be appreciated?

For reference it's around a 400 pound charge so not massive, but more the principle involved with this.

 

[Import Expert]

Under DDU all costs are included up to delivery point apart from Duty/VAT. (Correct incoterm is actually now DAP - changed in 2020). So yes you are correct - there should be no extra overseas charges. Does the Bill of Lading state DDU also or just your suppliers invoice?

 

[MOIC]

Pay to get the goods released if you want the goods.

Inform the supplier in writing what you agreed, I presume you have everything in writing.

It may be that the person you’re dealing with is not familiar with incoterms.

When it comes to making the balance payment to your supplier, provide a detailed summary of the account.

That’s when the negotiation will begin.

 

[GrahamH]

Great appreciate advice from you both, good to get these opinions.

Will pay up the charges now. I have our initial DDU agreement very clearly in writing so that's something.

Just checked the bill of lading it doesn't state DDU or DAP, it just states "freight prepaid". Not an expert in these logistics terms, but would this infer anything in regards to who pays origin charges?

 

[Import Expert]

Great appreciate advice from you both, good to get these opinions.

Will pay up the charges now. I have our initial DDU agreement very clearly in writing so that's something.

Just checked the bill of lading it doesn't state DDU or DAP, it just states "freight prepaid". Not an expert in these logistics terms, but would this infer anything in regards to who pays origin charges?

Yes probably best to avoid any detention/rent charges for now.

If freight prepaid is stated then yes that should cover everything that side.

 

[MOIC]

Freight prepaid will refer to the shipping cost (ocean freight), so destination charges are down to you.

In any event, pay it and negotiate with your supplier.

 

[PowerForwarding]

Ddi you query with the forwarder at all as to how comes you've been charged this? Is it only this charge they are billing? If just that charge then really you'd probably want to advise them to charge back to origin as you shouldn't be paying under DAP terms but given the worries of rent charges its up to you as to whether it would be worth it.

 

[Mike Foulds]

I would definitely get this paid, and goods collected, to avoid storage, which can quickly add up. As others have said, it would then be worth pointing this out to the shipper, and deducting this from the payment to them, whilst including a copy of the invoice from the shipping company to prove it was an extra which had to be paid, and under DDU (Or now DAP as has been pointed out), you shouldn't have had to pay ANYTHING apart from possibly a Customs Clearance cost and Duty/Vat. Good luck with fighting it.

 

[adam102]

I've recently imported some goods from China by sea. I agreed DDU terms with my supplier & paid for 50% of the goods upfront (other 50% to be paid on the delivery).

I have just received the quote from the UK based freight forwarder/customs agent (that's been working my suppliers Chinese based logistics firm). They've tried to bill me for "expenses at origin" charges, which from my understanding I shouldn't be paying under my DDU terms. Is this thinking correct?

When I've queried this with my supplier he isn't being particularly useful & is denying that this charge is from the Chinese port. This disagreement now means that the stock is currently stuck (soon to incur storage charges)

At this point I am thinking should I just pay this charge now to get the goods going & settle up/deduct when paying the other 50% of the bill. Any advice on whether this is a sensible approach or if there is a better route to take would be appreciated?

For reference it's around a 400 pound charge so not massive, but more the principle involved with this.

Hello, I am a freight forwarder in China. This fee may be related to the product name. Please confirm it with the customs clearance agent

 

[CHUKTC]

Graham you have done extraordinarily well to get your supplier to agree terms where 50% balance is paid on delivery - very few Chinese suppliers will offer this. It does put you in a very strong positiona dn enables you to withhold part of the balance payment to cover the excess charges being levied. It will be for them to argue the case for the extra funds from you. There have been a numbe rof threads on a similar theme in the past where the buyer has not been so fortunate and has paid for the goods beforeshiping leaving them in the almost impossible position of trying to recover the excess charges. Unfortuntely there are a number of suppliers who use incoming terms incorrectly (either by omission or wilfully) and it comes down to knowing your supplier well enough before trading with them.