What is DEQ (Delivered Ex Quay)?

Definition of DEQ

DEQ, or "Delivered Ex Quay," is an Incoterm used in international trade to specify that the seller delivers the goods to the buyer at the quay (or wharf) at the destination port. The term is part of the Incoterms 2000, but it has been replaced by the term DAT (Delivered at Terminal) in the Incoterms 2010. Despite its replacement, DEQ is still sometimes used in practice, and understanding its implications remains important.

Key Responsibilities Under DEQ

Under DEQ, the seller's responsibilities are extensive and include:

1. Export Packaging: The seller must pack the goods appropriately for export.

2. Export Licenses and Customs Formalities: The seller is responsible for obtaining the necessary export licenses and completing export customs formalities.

3. Carriage to Port of Shipment: The seller arranges and pays for the transportation of the goods to the port of shipment.

4. Loading Charges: The seller covers the costs of loading the goods onto the ship.

5. Main Carriage: The seller arranges and pays for the sea freight to the destination port.

6. Unloading Charges: The seller is responsible for the costs associated with unloading the goods at the quay at the destination port.

7. Import Duties and Taxes: Unlike other terms, under DEQ, the seller is also responsible for the import duties and taxes at the destination port.

8. Delivery at Quay: The seller delivers the goods at the quay, and the risk transfers to the buyer once the goods are placed at the quay at the destination port.

The buyer's responsibilities under DEQ are relatively limited and include:

1. Transport from Quay: The buyer is responsible for arranging and paying for the transportation of the goods from the quay to their final destination.

2. Insurance: The buyer arranges for insurance from the point the goods are delivered at the quay.

When to Use DEQ

DEQ is particularly useful in situations where:

1. Complex Import Processes: The seller has better knowledge or resources to handle complex import processes and can efficiently manage import duties and taxes.

2. Control Over Delivery Point: The seller wants to have control over the delivery up to a specific point in the destination country, ensuring that the goods are handed over at a designated quay.

Advantages and Disadvantages of DEQ

Advantages:

1. Seller Control:

The seller maintains control over the shipment until it reaches the quay at the destination port, ensuring proper handling and reducing the risk of damage or loss during the main carriage.

2. Simplified Buyer Responsibilities:

The buyer's responsibilities are minimized, as they only need to arrange transportation from the quay to their final destination and handle the associated insurance.

Disadvantages:

1. Higher Costs for Seller:

The seller bears significant costs, including import duties and taxes, which can be substantial depending on the destination country.

2. Complex Coordination:

The seller must coordinate with multiple parties to manage export, shipping, and import processes, increasing the complexity of the transaction.

Conclusion

DEQ (Delivered Ex Quay) is a comprehensive Incoterm that places significant responsibility on the seller to deliver goods to the quay at the destination port, covering all associated costs and formalities. While it provides advantages in terms of seller control and simplified buyer responsibilities, it also imposes higher costs and complex coordination requirements on the seller. Understanding DEQ and its implications is essential for international trade professionals to effectively manage their logistics and ensure smooth transactions.