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Introduction

Introduction. Purpose: International Trade Practice is a couse to study theory and practice of goods-sale .

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Introduction

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  1. Introduction • Purpose: International Trade Practice is a couse to study theory and practice of goods-sale . • Task: Students can master basic theory, knowledge and skills of International trade through this course, and learning to carry out principles and policies of the country combining the reality of our country, and understanding the international trade practice. 国际贸易实务讲义

  2. 一、Featureof international trade • It’s not only a economical activity, but also a foreignal affairs. • It’s a complicated affairs. • It’s unstable • Risks in it is larger than Domestic Trade • There are many related departments and intermediate links. • Competes intensely. 二、Law and Practice of international trade cargo’s sale （一）National law 国际贸易实务讲义

  3. （二）International Treaty or Agreement • International Treaty related Import&Export closely is United Nations Convention on Contracts for the International Sale of Goods （三）International trade practice 1、Nature and characteristic 2、Functions 三、Principle for the International Sales of Goods 国际贸易实务讲义

  4. 四、The basic content of contracts for the Internationa Sale of Goods. （一）Article of contract （二）Price of Goods （三）Obligations of the buyer （四）Obligations of the seller （五）Prevention and handle of controversy 国际贸易实务讲义

  5. 五、Procedure of Imoport&Export Trade • There are three proceduces of Import&Export trade: preparation before trade; negotiation of contract; performance of contract （一）Procedure of import （ 二）Procedure of export 国际贸易实务讲义

  6. 六、Structure of this book • This course are key on the trade terms and contract clause according to law and practice in international trade. Combining realities of our country, it introduces the basic links of signing and perform a sales contract. （一）Trade terms （二）Contract clauses （三）Negotiation and Performance （四）Modes of trade 国际贸易实务讲义

  7. Sructure of this course Chapter 1：Internatonal Trade Terms Chapter 2 ：Name, Quality, Quantity and Packing Chapter 3 ：Trasport of International Goods Chapter 4：Insurance of International Goods Chapter 5：Price of International Goods Chapter 6 ：Payment Chapter 7 ：Inspection, Claim, Arbitration and Force Majeure Chapter 8 ：Export Business Negotiation and Conclusion of Contract Chapter 9：Performance of Import and Export Contract Chapter 10：Trade Forms 国际贸易实务讲义

  8. Trade Terms Chapter 1 Trade Terms • Abstract： This chapter is empysis the function of the trade terms and related trade practis, especially 13 trade terms in INCOTERMS2000, FOB, CIF, CFR, FCA, CPT, CIP is the key terms. • Section 1 Trade terms and International Trade Practicde • Section 2 Six main trade terms • Section 3 Other trade terms • Section 4 Select of trade terms 国际贸易实务讲义

  9. Section 1 Trade terms and International Trade Practicde 一、Functions of trade terms • Trade terms are also known as Price terms,which have two aspects: Conditions of Delivery and Price of Delivery 二、Related International Trade Practice （一）The Warsaw Oxford Rules 1932 • Explanation about CIF （二）The Reviced American Trade Definitions 1941 • Explanation about 6 trade terms, key on FOB and FAS 国际贸易实务讲义

  10. （三）International Commorcial Terms for short（INCOTERM2000） • Formulated by International Chamber of Commerce 1、Generating process of Incoterms2000 2、Reasons of verifying Incoterms2000 国际贸易实务讲义

  11. （1）to meet the need of EDI in international trade EDI（Electronic Data Interchange) is a system that chang the electric messages and deal with the message according to a agreement among computers. （2）to adapt the development of transport technology, especially for the container transport, roll-shipment transport and multimodal transport. （3）easy to grasp and conforming with the practice. （4）to adapt to the deveiopment of free-tariff area。 ( Where Applicable) 国际贸易实务讲义

  12. Comparing with Incoterms1990, substantive charges bave been made in two areas in Incoterms2000: （1）the customs clearance and payment of duty obligations under FAS and DEQ; and （2）the loading and unloading obligations under FCA 3、Coverage of Incoterms2000 4、The structure of Incoterms2000 5、Notices of Incoterms2000 国际贸易实务讲义

  13. Section 2 Six main trade terms 一、FOB（Free on board ….named port of shipment) （一）The meaning of FOB （二）The obligations of both the seller and the buyer • the place of delivery, allocation of risds, the obligations and cost-payment of carriage and insurance,import&export customs clearance and cost-payment, documents of delivery 国际贸易实务讲义

  14. Incoterms2000：if the parties do not intend to deliver the goods across the ship's rail, the FCA, CPT, CIP term should he used. （三）Notices of using FOB 1、Clear meaning of “passing the ship’s rail” 2、Sometimes risks will transfer in advance. But the precondition is that goods should be specialized no matter when risks transfer. That’s to say, the goods have belongs to the contract at the right place, and be separated with other goods. 国际贸易实务讲义

  15. 3、Link-up of vessel and goods 4、The difference explanation of FOB between The Revicde American Trade Definitions 1941 and Incoterms2000 （1）Expressing:if the buyers want to deliver the goods at the ports of shipment, they should add“Vessel” between FOB and port’s name,for example “FOB Vessel New York” （2）transport modes （3）allocation of Risk （4）obligatin of export formalities and cost-payment 国际贸易实务讲义

  16. 5、Division of loading costs • Variations of FOB: （1）FOB Liner Terms （2）FOB Under Tackle • Lighterage is due to the seller （3）FOB Stowed （4）FOB Trimmed （5）FOBST 国际贸易实务讲义

  17. 二、CIF（Cost Insurance and Freight… Named port of destination） （一）The meaning of CIF （二）The obligations of both the seller and the buyer • Notice: the place of delivery, allocation of risds, the obligations and cost-payment of carriage and insurance,import&export customs clearance and cost-payment, documents of delivery 国际贸易实务讲义

  18. （三）Notices of using CIF 1、CIF contract belings to shipment contract • division of risks and costs is separated 2、the sellers is responsible for marine insurance • Incoterms2000: If there is no clear stipulation about the insurance in the contract, the seller should be required to obtain insurance only on minimum cover, and it just for the buyer 国际贸易实务讲义

  19. 3、chartering a ship or book shipping spaceis due to the seller 4、Symbolic Delivery • The conception of Symbolic Delivery and Physical Delivery • Under the condition of Symbolic Delivery, the seller deliver goods by documents,and the buyer pay the price by documents • In CIF contracts, we must avoid these clauses such as “requiring the seller is responsible the goods’ arrival” and “the buyer pay the price on conditions of the goods’arrival” 国际贸易实务讲义

  20. 5、Division of unloading charge • Variations of CIF: （1）CIF liner Terms （2）CIF landed （3）CIF Ex Tackle （4）CIF Ex Ship,s Hold 国际贸易实务讲义

  21. 三、CFR（Cost and Freight） • Comparing with CIF, the obligations are rough the same, difference is : the seller have no obligation for the insurance under CFR • Especially notice: Shipping advice should be sent as soon as possible. If not, transfer of risk will be later. 国际贸易实务讲义

  22. 四、FCA（Free Carrier) （一）The meaning of FCA: （二）The obligations of both the seller and the buyer • Notice: the place of delivery, allocation of risks, the obligations and cost-payment of carriage and insurance,import&export customs clearance and cost-payment, documents of delivery （三）Notice: 1、About Carrier and delivery place • It should be noted that the chosen place of delivery has an impace on the obligations of losding and unloading the goods at the place. It depends on if it occurs at the seller’s premises. 国际贸易实务讲义

  23. 2、Passing of Risks : It’s possible that the risks pass in advance 3、Divisions of obligation and costs 五、CPT（Carriage Paid to， ） （一）The obligations of both the seller and the buyer • Comparing with FCA,other obligations are wimilar with FCA,besides the wdller must contract on usual terms at his own expense for the carriage of the goods （三）Notices of using CPT 1、The allocation of risk 2、Division of obligations and cost 3、The difference and the same between CPT and CFR 国际贸易实务讲义

  24. 六、CIP（Carriage and Insurance Paid to，） • Comparint with CPT, other obligations are similar with CPT, besides seller must cover insurance and pay for the insurance cost • Among 13 trade terms, only CIF and CIP involve the insurance • The difference between CIP and CIF：Case analysis : Beijing A Company plans to export some goods in 5,000 cases to B Company in New York. B Company want to make a deal under FOB new harbour, but A Company tends to use FCA Beijing.Then please try to find out above-mentioned reason of terms • these two Companies proposed . 国际贸易实务讲义

  25. FCA、CPT、CIP与FOB、CFR、CIF的区别 1、Mode of transport 2、The place of delivery and the allocation of risk 3、The divisin of loading and unloading cost 4、The kinds and the time of provide the transport documents are different. 国际贸易实务讲义

  26. Section 3 Other trade terms 一、EXW（Ex Works ）Ex Warehouse,Ex Mine,Ex Plantation （一）The obligations of both the seller and the buyer • This term thus represents the minium obligation for the seller, and the buyer has to bear all costs and risks involved in taking the goods from the seller’s premises. • EXW is the price of physical delivery.。 • EXW may be used irrespective of the mode of transport. 国际贸易实务讲义

  27. （二）Notices of using EXW 1、Link-up of vessel and goods 2、Packing and shipment of goods • According to the minium obligation for the seller,the seller mustn’t responsible for the loading of the goods on departure and to bear the risks and all the costs of wuch loading 3、About all customs formalities for the export of the goods 4、The costs of inspections • The buyer must pay the costs of any pre-shipmnet inspection, including inspection mandated by the authorities of the country of export. 。 国际贸易实务讲义

  28. 二、FAS（Free Alongside Ship） （一）The meaning of FAS: （二）Notices of using FAS: 1、Differnet explanation between the Reviced American Trade Definities 1941 and Incoterms 2000 2、The seller to clear the goods for export 3、Link-up of vessel and goods 国际贸易实务讲义

  29. 三、DAF（Delivered At Frontier） （一）The meaning of DAF • The term “frontier” may be used for any frontier including that of the country of export. Notice: The seller basn’t the obligation of unloading in Incoterms2000 （二）Notices of using DAF 1、The difference between DAF and CPT 2、Mode of transport:This term may be or respective of the mode of transport when goods are to be delivered at a land frontier. When delivery is to take place in the port of destination on blard a vessel of on the quay(wharf), the DES of DEQ terms should be used. 国际贸易实务讲义

  30. 四、DES（Delivered Ex Ship） （一）The meaning of DES: （二）Notices of using DES: 1、Link-up of vessel and goods 2、The difference between DES and CIF • If ship can pull in to shore directly, DES is the real arrival price. （1）the place of delivery （2） allocation of risks （3）responsible for the costs （4） properties of delivery 国际贸易实务讲义

  31. 五、DEQ（ Delivered Ex Quay,） • The seller has to bear costs and risls involved in bringing the goods to the named port of destination and discharging the goods on the quay(wharf) • Notice: The DEQ term requires the buyer to clear the goods for import and to pay for all formalities duties,taxes and other charges upon import. • Mode of transport:This term can be used onlu when the gods are to be delivered by sea or inland waterway or multimodal transport on discharging from a vessel onto the quay (wharf) in the port of destination 六、DDU（ Delivered Duty Unpaid, ） • DDU is also suit to the trade in Free Trade Area and countries which sign tariff agreement. 国际贸易实务讲义

  32. 七、 DDP（ Delivered Duty Paid • Under DDP the seller clear the goods for import and pay any duty as a consequence thereof. • DDP represents the maximum obligation,costs and risks, so the price that the seller charged is highest. 国际贸易实务讲义

  33. Section 4 Choosing the trade terms 一、Summary of Trade terms （一）The “E” term: Departure （二）The “F” term: Main Carriage Unpaid （三）The “C” term: Main Carriage Paid 注：Allocation of risks and costs is separated • 注：The “F” term and the “C” term are all belong to “shipment” contracts. 国际贸易实务讲义

  34. （四）The “D” term: Arrival • The “D” term contracts belong to “arrival” contracts • Under these terms seller can’t responsible for unloading the goods except DEQ 二、13 kinds of trade terms tabulate the contrast Notice： The “D” and “E” term contracts belong to “arrival” contracts, “F” and “C” term contracts belong to “shipment” contracts 国际贸易实务讲义

  35. 三、Relatins of trade terms and contract’s property 1、Trade term depermine the property of sales contracts 2、Avoiding contradictions between trade term and conditions in sales contracts 3、Notice trade term and term in the contract of transportation in the deal contract linking up each other 四、Packing and inspection of goods • Except EXW, the buyer must pay the costs of any pre-shipment inspection except when such inspection is mandated by the authorities of the country of export. 国际贸易实务讲义

  36. 五、Select the main factor that the trade term should be considered for use 1、Transport conditions 2、source of goods 3、Factor of the freight charges 4、Risk in the transportation way 5、Whether going through the customs chearance of the cargoes imported and exported formalities has difficulty 国际贸易实务讲义

  37. Summaries of this chapter: • This chapter has told 13 kinds of prices term of Incoterm2000 mainly, among them need to grasp FOB, CFR, CIF, FCA, CPT and CIP six kinds of terms especially. • Grasping it from the place of delivery mainly to every kind of trade term, the risk shilts the demarcation line, is it transport to handle and obligation and relevant burden, responsibility and between burden and suitable transportation way, etc. tespest of expenses that imports and exports declare at the Customs of expenses of insurance consider. 国际贸易实务讲义

  38. Exercise 1、Writing and understanding the 13trade terms correctly. 。 2、Comparing the trade terms： • FOB、CFR and CIF • CFR and CPT • CIF and CIP • FOB、CFR、CIF and FCA、CPT、 CIP • DES and CIF 国际贸易实务讲义

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