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International Commercial Contracting : Identifying and Addressing Risk Areas. Breakout Session 1404 Jeffrey L. Roth, Attorney, Fees & Burgess, P.C. Allen L. Anderson, Attorney, Fees & Burgess, P.C. April 24, 2007 10:45 a.m. – 11:45 a.m.
International Commercial Contracting: Identifying and Addressing Risk Areas
Breakout Session 1404
Jeffrey L. Roth, Attorney, Fees & Burgess, P.C.
Allen L. Anderson, Attorney, Fees & Burgess, P.C.
April 24, 2007
10:45 a.m. – 11:45 a.m.
Japanese “wa” concept is reflected in the Japanese negotiation style by placing emphasis on developing a trusting long term relationship; there is an aversion to litigation and emphasis on contracting parties working out differences among themselves.
Contractual parties : _________________
Seller : ____________, _______ Czech Republic
Buyer : ____________________
________ as per Appendix A of that Agreement
Prices as per Appendix A
Prices are valid for _ months from date of agreement. Prices should be revised quaterly on last day of March, June, September and December, using __________ for ____ of wheel price.
Method of Payment
Net 30 from Invoice day. If the payment is not paid within 30 days, Seller has right to invoice penalty in amount of __% per each week of delay, up to __% of value of unpaid goods.
Supplier deliver Goods to Customer in regular monthly batches on parity CIF Chicago as per dates in Appendix B of that agreement.
Transfer of Risk and Title
Risk on Goods to pass from Supplier to Buyer upon delivery on parity ___________, title to pass upon full payment.
The product shall be guaranteed by the Supplier for ____ years against any defect attributable to production and not detected in the inspection at the Supplier’s works. This period shall start from the end of the month marked on the Product. The Product, which during the guarantee period proves to have faults making them unsuitable for service or reducing its service life, shall be rejected. However, before being rejected definitively, the defective product may be submitted to an examination in the presence of both parties – the Buyer and the Supplier – if the latter so requests.
This agreement is entered into this __day of __________2006 between _________________________________ with offices at ____________, ________, China ("Seller"), and ______________________ with offices at _______________, _________, ________ _________ ("Buyer").
The Seller agrees to sell, and the Buyer agrees to buy, ____________ ("Goods") in accordance with the following agreement and terms:
1. SPECIFICATIONS - The description and specifications of the Goods to the delivered under this Agreement ("Specifications") shall be as set forth in Attachment 1 to this Agreement, incorporated herein by reference.
2. PRICING - Pricing, quantities and the delivery schedule of Goods shall be as set forth in Attachment 2 to this Agreement, incorporated herein by reference. All prices shall be in U.S. dollars.
A. Packing Requirements - Goods shall be packed according to Buyer's Drawing No. _______________, _________ .
B. Shipping Marks: N/M
C. FOB _________ (Incoterms 2000)
D. Subject to Clauses 3F and 3G and satisfactory inspection in accordance with Clause 4 below, title to the Goods shall transfer to Buyer upon delivery to the Buyer’s designated shipper at the ___________.
E. The Seller warrants that it has sufficient capacity to produce and deliver the Goods in accordance with the delivery schedule in Attachment 2. If any event contemplated pursuant to Article 79 of the United Nations Convention on International Sale of Goods occurs and hence affecting delivery under this Agreement, the Seller agrees that it will allocate existing supply of the Goods, and capacity to manufacture the Goods, to Buyer in accordance with the ratio of the Buyer's open or unsatisfied orders for the calendar year compared to all open orders for the Goods for the calendar year.
Argentina, Australia, Austria, Belarus, Belgium, Bosnia, Bulgaria, Burundi, Canada, Chile, China, Croatia, Cuba, The Czech Republic, Denmark, Ecuador, Egypt, Estonia, Finland, France, Georgia, Germany, Ghana, Greece, Guinea, Herzegovina, Holland, Hungary, Iraq, Italy, Kirghizstan, Latvia, Lesotho, Lithuania, Luxembourg, Mauritania, Mexico, Moldova, Mongolia, New Zealand, Netherlands, Norway, Peru, Poland, Romania, Russia, Switzerland, Slovakia, Slovenia, Singapore, Spain, Sweden, Syria, Uganda, Ukraine, United States of America, Uruguay, Uzbekistan, Venezuela, Zambia
Writing and other Requirements:
UCC - Battle of the Forms
“Where both parties use standard terms and reach agreement except on those terms, a contract is concluded on the basis of the agreed terms and of any standard terms which are common in substance unless one party clearly indicates in advance, or later and without undue delay informs the other party, that it does not intend to be bound by such a contract.”
UCC § 2-314
UCC § 2-315
(1) The Seller must deliver goods which are of the quantity, quality and description required by the contract and which are contained or packaged in the manner required by the contract.
CISG Article 46(1)
(1) The Buyer may require performance by the Seller of his obligations unless the Buyer has resorted to a remedy which is inconsistent with this requirement.
UCC § 2-711
(2) Where the seller fails to deliver or repudiates the Buyer may also …
(b) in a proper case obtain specific performance or replevy the goods as provided in this Article (Section 2-716).
Because international laws may vary significantly, pick the system that is most advantageous to you or your business, and determine up front what the parties rights and obligations will be under any contract. Predictability and certainty can be attained in an international setting with foresight and planning.
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Michael L. Fees
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