Which of the following incoterms has the lowest risk to the buyer?

Incoterms® 2020 rules define the transfer of risk from seller to buyer. Under Delivered Duty Paid (DDP), the seller bears the maximum obligation and risk. The seller is responsible for delivering the goods to the buyer's named destination, cleared for import, with all duties and taxes paid. The risk only transfers to the buyer once the goods have arrived at the destination and are ready for unloading. This arrangement provides the lowest level of risk and responsibility for the buyer, as the seller manages the entire transportation process, including customs clearance and associated risks.

A. Ex Works (EXW) represents the highest risk to the buyer, as they assume all risks from the seller's premises onwards.
C. Carriage and Insurance Paid To (CIP) transfers risk to the buyer once the goods are handed to the first carrier, not at the final destination.
D. Free on Board (FOB) transfers risk to the buyer once the goods are loaded on board the vessel at the port of origin.

International Chamber of Commerce. (2019). Incoterms® 2020: ICC rules for the use of domestic and international trade terms. ICC Publication. The official guide explicitly states DDP places the maximum obligation on the seller.

CIPS (2018), Ethical and Responsible Sourcing L4M4, Profex Publishing Limited. Chapter 8: International Logistics, Section on 'Incoterms', explains that DDP represents the lowest risk for the buyer.

Lowe, D. (2009). The CIPS Course Book: Commercial Contracting. Cengage Learning. Chapter on Incoterms clarifies that risk transfer under DDP occurs at the buyer's destination, making it the most buyer-friendly term.