Who Actually Pays the Duty on Imported Building Materials
The unit price on a cross-border quote is very often not the price you end up paying. Three letters in the shipping terms decide who covers duty, customs entry and brokerage, and a great many quotes never state them at all.
The invoice that turns up after the goods
The pattern is familiar to anyone who has bought materials across a border. The shipment arrives, it gets installed, the job moves on. Several weeks later an invoice appears from a customs broker nobody in your office remembers hiring, for an amount that was in no line of the budget.
It goes to accounts payable, who query it. It comes back to the project manager, who checks the original quote and finds nothing about duty in it. By then the material is in the building and the money is owed regardless.
The goods were cheaper than the alternative. The job was not.
What sits between the quote and the delivered cost
A quoted unit price covers goods. Getting those goods through customs involves a separate stack of charges, and none of them appear on the quote unless somebody deliberately puts them there.
- Customs duty. Calculated from how the product is classified and where it originates, applied to the declared value.
- Customs entry and clearance. A fee for filing the entry, charged whether or not any duty is owed.
- Brokerage. The broker's own fee for handling the entry on your behalf.
- Disbursement. If the broker fronts the duty rather than waiting for you, there is usually a percentage charge for carrying it.
- Processing fees. Small individually, and applied per shipment rather than per order, so a phased delivery multiplies them.
- Product-specific measures. The one that catches building products most often. See below.
On a single small order these can be an irritation. On a project quantity split across several releases, they compound in a way nobody modelled.
The three letters that decide who pays
Shipping terms are written as Incoterms, a standard set of three-letter codes. They are the whole answer to the question in the title, and they are worth knowing properly because two of them look nearly identical on a quote.
| Term | Means | Who pays duty and fees |
|---|---|---|
| DDP | Delivered duty paid | Seller. The quoted price is what you pay. |
| DAP / DDU | Delivered at place | You. Seller gets it to your door, import charges are yours on arrival. |
| CIF / CFR | Cost, insurance, freight | You. Covers freight to the port, not import clearance. |
| EXW | Ex works | You. It is yours from the supplier's loading dock onward. |
The trap is DAP. Both DDP and DAP contain the word "delivered", and on a quote being skimmed at five o'clock they read the same. They are not the same. One of them means the price is final and the other means the price is a deposit.
Why this quietly breaks bid comparisons
Put two supplier quotes side by side. One is DDP, one is DAP, and the DAP quote comes in lower on unit price. Procurement takes the cheaper one, because on the face of it that is the job.
The two numbers were never comparable. One included import costs and the other deferred them, and the gap between them does not disappear, it just arrives later and against a different budget line.
This matters most when you are bidding rather than buying. A quote you carried into a fixed-price bid on the assumption that it was landed cost leaves you absorbing the difference personally. The client's number is already set.
The discipline is simple. Do not compare unit prices across a border. Convert both to landed cost, or insist that every quote you accept is stated DDP so they are landed cost already.
Steel is its own conversation
Ordinary duty is not the only thing that can apply to a steel building product. Steel has been subject to additional trade measures in the United States for several years, separately from the standard tariff schedule, and the rules around them are revised more often than most construction schedules run.
Origin documentation is what usually determines the treatment, and whether a shipment carries the right certification is a supplier question rather than a broker question. The broker can only file what they are given.
Two things follow from that. Do not assume a product's treatment based on what a similar shipment cost last year. And ask the supplier what documentation actually travels with the goods, before the goods travel.
Five questions before you accept a cross-border quote
- Is this price DDP? Ask in exactly those words and get the answer in writing on the quote itself, not in an email thread.
- If it is not DDP, what is the estimated landed cost? A supplier who ships across the border regularly can give you a realistic figure. One who cannot is telling you something useful.
- Who is broker of record? If the answer is that one will be assigned at the border, you have no control over what they charge.
- What documentation travels with the shipment? Origin certification in particular.
- What triggers an extra charge? Remote delivery areas, redelivery after a missed appointment and storage after arrival are the three that appear most often.
How TRM handles it
Every order into the United States ships delivered duty paid. Duties, taxes and customs fees are covered by us, so there is no brokerage invoice arriving weeks later, nothing owed at the door, and no line your purchase order failed to anticipate. Shipping is free.
Everything is manufactured in North America, which is the reason that number can be quoted with confidence rather than estimated.
The point is not that this is generous. It is that a price you can carry into a fixed-price bid without a contingency against it is worth more than a lower price you cannot.
Two honest exceptions. Addresses classed as remote may carry an additional delivery cost, which we quote to you before anything ships rather than after. And we cannot deliver to PO boxes, so a physical street address is needed on every order.