We import goods into the UK under an authorised end-use approval granted by HMRC which means import duty is suspended. We then sell the goods to our UK customer using a TORO (Transfer of Risks and Obligations) arrangement in the approval.

In the contract of supply to the UK customers, HMRC say we are supplying them on the DDP (Delivered Duty Paid) Incoterm, but we believe we should be supplying under DAP (Delivered at Place).

We have a deed of indemnity with our UK customer which sits at the side of the contract of supply which legally protects us if HMRC charge duty because our customer fails to meet the compliance obligations under authorised use. Is it correct to change the Incoterms® rule to DAP?

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