How to Avoid U.S. Tariffs as an International Supplier

The U.S. administration has imposed import tariffs on Canada, Mexico, and China, and threatens similar measures against the EU.

If you are a supplier outside the U.S., you should not agree to DDP (place of destination in the U.S.) Incoterms 2020 as a delivery term. Otherwise, under DDP (Articles A7 and A9 of Incoterms 2020), you assume all import clearance formalities and the associated responsibilities, risks, and costs (tariffs, taxes, etc.). It can also be physically and legally challenging for foreign suppliers to fulfill these obligations in the U.S.

Generally, ensure you do not take on any responsibilities, risks, or costs related to possible U.S. tariff increases in your sales contracts with U.S. buyers.

Please also note that you may not claim Force Majeure when tariffs are already in effect or have been announced at the time of the conclusion of the respective contract.