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INTERNATIONAL SALES LAW - seminar 2004

INTERNATIONAL SALES LAW - seminar 2004. ISL. ISL: objectives, functions and structure. I. Management of information on ISL. II. Contractual Risk Management in Transnational Sales Transactions. III. IV. Management of risk of contractual disputes. Management of risk of contract breach. V.

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INTERNATIONAL SALES LAW - seminar 2004

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  1. INTERNATIONAL SALES LAW - seminar 2004 ISL ISL: objectives, functions and structure I Management of information on ISL II Contractual Risk Management in Transnational Sales Transactions III IV Management of risk of contractual disputes Management of risk of contract breach V VI Management of risk of loss of or damage to the goods Management of risk of changed circumstances VII VIII Case study IX Case studies

  2. ISC CONTRACT LAW CONTRACTING Management of risk of loss of or damage to the goods ISL Default distribution of the risk in sales law I II CISG art. 67: (1) If the contract of sale involves carriage of the goods and the seller is not bound to hand them over at a particular place, the risk passes to the buyer when the goods are handed over to the first carrier for transmission to the buyer in accordance with the contract of sale. If the seller bound to hand the goods over to a carrier at a particular place, the risk does not pass to the buyer until the goods are handed over to the carrier at that place. The fact that the seller is authorized to retain the documents controlling the disposition of the goods does not affect the passage of the risk. (2) Nevertheless, the risk does not pass to the buyer until the goods are clearly identified to the contract, whether by markings on the goods, by shipping documents, by notice given to the buyer or otherwise. III CISG art. 68: The risk in respect of goods sold in transit passes to the buyer from the time of the conclusions of the of the contract. However, if the circum-stances so indicate, the risk is assumed by the buyer from the time the goods were handed over to the carrier who issued the documents embodying the contract of carriage. Nevertheless, if at the time of the conclusion of the contract of sale the seller knew or ought have known that the goods had been lost or damaged and did not disclose this to the buyer, the loss or damage is at the risk of the seller. IV V VI VII • CISG art. 66-70, 79 VIII IX

  3. ISC CONTRACTING Management of risk of loss of or damage to the goods ISL Default distribution of the risk in contract law I CENTRAL TCL database No. IV.4.6. Rights and Duties of the partied under ”FOB”, ”FAS”, ”CIF” and ”CF” ”If the parties have agreed on a sale "FOB", "FAS", "CIF" or "CF", the respective rights and duties of the parties under the contract are to be determined according to the latest version of the International Commercial Terms (INCOTERMS) issued by the International Chamber of Commerce (ICC) unless the parties have indicated that a different meaning is to be attributed to the term used.” II III IV V VI • PECL chapters 7 to 9 • UPICC chapters 6 and 7 • CENTRAL TLDB No. IV.4.6 and Ch. V to IX VII • CISG art. 66-70, 79 VIII IX

  4. ISC CONTRACTING Management of risk of loss of or damage to the goods ISL Contractual allocation of the risk in contracting practice I II III IV V VI • PECL chapters 7 to 9 • UPICC chapters 6 and 7 • CENTRAL TLDB No. IV.4.6 and Ch. V to IX VII • CISG art. 66-70, 79 VIII IX

  5. Sales Sales Sales Sales Sales Transport Finance Finance Finance Insurance Management of risk of loss of or damage to the goods ISL A Brief Overview on Transfer of: I Goods: II Documents: III IV Property right: S B V VI Payment: VII Risk of loss of or damage to the goods: VIII IX

  6. ISC Management of risk of loss of or damage to the goods ISL Contractual allocation of the risk in contracting practice I II III IV V VI • - Incoterms &Combiterms • Institute Cargo Clauses • Exemption-clauses • Force majeure -clauses • Hardship-clauses • PECL chapters 7 to 9 • UPICC chapters 6 and 7 • CENTRAL TLDB No. IV.4.6 and Ch. V to IX VII • CISG art. 66-70, 79 VIII IX

  7. Management of risk of loss of or damage to the goods ISL Contractual allocation of the risk in contracting practice I II III TRADE TERMS CONCERNING CARRIAGE OF GOODS INCOTERMS 2000 IV V VI VII VIII IX

  8. D-clauses Division of costs: B B B B B B B B C-clauses Ins F B S c F-clauses EXW

  9. C-clauses S? S? B B B B B B Ins D-clauses C-clauses F-clauses FCA EXW F B S c

  10. C-clauses S S S S B S B B B B B B B B B B Ins Ins D-clauses C-clauses FOB FAS FCA EXW F B S c

  11. C-clauses D-clauses C-clauses FOB FAS FCA EXW F B S c

  12. S S S S S S S/B S S S S/B S/B B B B B Ins Ins D-clauses CIF CFR FOB FAS FCA EXW F B S c

  13. CPT S S S S S S (B) S S S S/B S/B S/B? S/B? S/B? S/B? Ins Ins D-clauses CIP CIF CFR FOB FAS FCA EXW F B S c

  14. CPT D-clauses CIP CIF CFR FOB FAS FCA EXW F B S c

  15. CPT S S S S S S (S) (S) S S S B B B B B Ins Ins DEQ DES CIP CIF CFR FOB FAS FCA EXW F B S c

  16. CPT S S S S S S S S S (S) (S) (S) S S S S S S B S+ S S S B Ins Ins Ins DDP DDU DAF DEQ DES CIP CIF CFR FOB FAS FCA EXW F B S c

  17. CPT DDP DDU DAF DEQ DES CIP CIF CFR FOB FAS FCA EXW F B S c

  18. C-clauses D-clauses F-clauses EXW F B S c

  19. ISC Management of risk of loss of or damage to the goods ISL Contractual allocation of the risk in contracting practice The ICC Model International Sale Contract ICC Publication No 556 B. GENERAL CONDITIONS Art. 8 Contractual term of delivery ”Unless otherwise agreed, delivery shall be ”Ex Works” (EXW).” I ORGALIME S 2000 GENERAL CONDITIONS for the supply of mechanical, electrical and electronic products DELIVERY. PASSING OF RISK Clause 9. ”Any agreed trade term shall be constructed in accordance with the INCOTERMS in force at the formation of the contract. If no trade term is specifically agreed, the delivery shall be Ex Works (EXW). If in the case of delivery Ex works, the Supplier, at the request of the Purchaser, undertakes to send the Product to its destination, the risk will pass not later than when the Product is handed over to the first carrier. Partial shipments shall be permitted unless otherwise agreed.” II III IV The ICC Model International Sale Contract ICC Publication No 556 B. GENERAL CONDITIONS Art. 1 General Art. 1.3 ”Any referance made to trade terms (such as EXW, FCA, etc.) is deemed to be made to the relevant term of Incoterms published by the International Chamber of Commerce.” V VI • Incoterms & • Combiterms • Institute Cargo Clauses • Exemption-clauses • Force majeure -clauses • Hardship-clauses • PECL chapters 7 to 9 • UPICC chapters 6 and 7 • CENTRAL TLDB No. IV.4.6 and Ch. V to IX VII • CISG art. 66-70, 79 VIII IX

  20. ISC Management of risk of loss of or damage to the goods ISL Contractual allocation of the risk in contracting practice I II III ORGALIME S 2000 GENERAL CONDITIONS for the supply of mechanical, electrical and electronic products Consequential Losses ”43. Save as elsewhere stated in these conditions there shall be no liability for either party towards the other party for loss of production, loss of profit, loss of use, loss of contracts or for any consequential or indirect loss whatsoever.” IV V VI • Incoterms & • Combiterms • Institute Cargo Clauses • Exemption-clauses • Force majeure -clauses • Hardship-clauses • PECL chapters 7 to 9 • UPICC chapters 6 and 7 • CENTRAL TLDB No. IV.4.6 and Ch. V to IX VII • CISG art. 66-70, 79 VIII IX

  21. ISC Management of risk of loss of or damage to the goods ISL Contractual allocation of the risk in contracting practice • ICC • FORCE MAJEURE Clause 2003 • Unless otherwise agreed in the contract between the parties expressly or impliedly, where a party to a contract fails to perform one or more of its contractual duties, the consequences set out in paragraphs 4 to 9 of this Clause will follow if and to the extent that that party proves... • Where a contracting party fails to perform one or more of its contractual duties because of default by a third party whom it has engaged... • 3.-6. ... • A party invoking this Clause is under an obligation to take all reasonable means to limit the effect of the impediment or event invoked upon performance of its contractual duties... • (on termination due to substansially deprived expectations, within a reasonable period) • 9. ... where either contracting party has, by reason of anything done by another contracting party... derived a benifit before termination... duty to pay the other party... a sum... equivalent to the value of such benefit. I ORGALIME S 2000 FORCE MAJEURE 39. Either party shall be entitled to suspend performance of his obligations under the contract to the extent that such performance is impeded or made unreasonably onerous by any of the following circumstances: industrial disputes and any other circumstance beyond the control of the parties such as fire, war, extensive military mobilization, insurrection, requisition, seizure, embargo, restrictions in the use of power and defects or delays in deliveries by sub-contractors caused by any such circumstance referred to in this Clause. A circumstance referred to in this Clause whether occurring prior to or after the formation of the contract shall give a right to suspension only if its effect on the performance of the contract could not be foreseen at the time of the formation of the contract. Similarly: NL 01 E Art. 36 Compare: ICC Model International Sale Contract B. General conditions Art. 13 Force majeure II III IV V VI • Incoterms & • Combiterms • Institute Cargo Clauses • Exemption-clauses • Force majeure -clauses • Hardship-clauses • PECL chapters 7 to 9 • UPICC chapters 6 and 7 • CENTRAL TLDB No. IV.4.6 and Ch. V to IX VII • CISG art. 66-70, 79 VIII IX

  22. ISC Management of risk of loss of or damage to the goods ISL Contractual allocation of the risk in contracting practice I • ICC • HARDSHIP Clause 2003 • A party to a contract is bound to perform... even if... more onerous than could reasonably have been anticipated... • Notwithstanding paragraph 1... • [a] ... excessively onerous...beyond its reasonable control... could not reasonably have been expected to have taken into account... and... • [b] ... could not reasonably have avoided or overcome the event of its consequences, • the parties are bound, within reasonable time... to negotiate alternative contractual terms... • 3. ... not agreed...the Party invoking this Clause is entitled to termination of the contract. II III IV V VI • Incoterms & • Combiterms • Institute Cargo Clauses • Exemption-clauses • Force majeure -clauses • Hardship-clauses • PECL chapters 7 to 9 • UPICC chapters 6 and 7 • CENTRAL TLDB No. IV.4.6 and Ch. V to IX VII • CISG art. 66-70, 79 VIII IX

  23. Go to section VII Management of risk of changed circumstances

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