Buy and Purchase
Buy and Purchase at sight
Buy and Purchase Samples
Buy and Purchase EXW
Buy and Purchase LAB
Buy and Purchase CF
Buy and Purchase CIF
Association in Participation
Brokerage and Distribution
STRATEGIC ALLIANCE CONTRACTS
Union stocks and similar
Company Clusters or Associations
Limits on the concentrations
- General Sales Contract
SPECIAL PURCHASE AND SALES
- Buy and Purchase in store or warehouse
- Buy and Purchase in fair or market
- Buy and Purchase on samples.
- Buy and Purchase test or sample.
- Buy and Purchase from place to place.- From the economic point of view, are the most important commercial sales of major operations of sales tend to be of this nature. The international traffic and a good part of the interior is done with obligation to the seller to transmit or make transporting the goods to the destination square. In this way the transport has an impact on the relationship of sales as a necessary element for the delivery.
Sometimes the seller agrees to deliver in the f destination place, in such a way as to carry the thing to the right place, at its own expense and the risks of transportation: sales "franco station", "franco domicile".
But other times, perhaps the most, the seller is only obliged to transmit or send by starting the transport operation but without running with the risks of this. Delivery is made by putting the goods in the hands of the carrier and is free of the loss or damage future sale "on wagon", "free on board" or FOB and CIF.
Sales "on wagon" and FOB, used respectively the rail traffic and in the sea and air, have similar content. The contract is fulfilled by placing the goods on wagon, on board the vessel, or in the airport of embarkation agreed; from that moment the delivery is made and occurs the transmission of the property and the risk to the buyer, that should cover the transportation and insurance, unless commissioning the seller to arrange these contracts by your account. But in this case that mandate no effect at all on the operation of the sale.
The CIF sale is more complex. In it, the seller has not only to initiate the transport, by placing the goods in the ship, but undertakes to enter into the freight and insurance of the goods, giving the effect of the sale price a comprehensive of the cost or value of the goods plus the insurance and freight. (Hence the abbreviation CIF, the initials of the English words "cost", "insurance", "freight").
Buying and selling of commercial establishment.- For the validity of the contract just the consent of the parties and is not need to observe special forms or any requirement for advertising. However, this does not mean that, in the transmission of the unique property which is part of the establishment will have to respect those forms that may be established by law with respect to each one of them.
International Sale.- The sale, the central institution of the foreign trade, is of preferential consideration in this process of unification of commercial law. The growing development of international trade has come to demand, for the sake of greater traffic safety, a uniform regulation of the sale, to avoid possible conflicts of laws derived from the disparity of national legal systems.
Uniform legislation.- The movement of legislative unification of international sales is initiated in the first third of this century and culminates, under the auspices of the Institute of Rome for the Unification of Private Law (UNIDROIT), with the adoption by the diplomatic conference in the Hague in 1964 of two uniform laws: one on the content of the international contract of sale, and another on the formation of contracts for international sale.
The first of these laws, Uniform Law for International Sales (LUCI), is the most important and governs the obligations of the seller and the buyer arising from the contract of sale (art. 8).
The second Uniform Law on the Formation of Contracts for the International Sale (LUFCI), is supplementary to the previous and is limited to regulate the process of formation of the contract.
For these and other reasons the uniform laws have received scant number of ratifications and are currently under review by the United Nations Commission for the Unification of International Trade Law (UNCITRAL), is at an advanced stage of preparation a UNIDROIT draft on the validity of contracts for the international sale.
Contracts-type and general conditions of sale.- The movement of international unification of the sale is also manifested in the preparation of contracts and general conditions of sale, whose subsequent dissemination ensures a progressive uniformity of the contractual practice.
Inside the phenomenon of criminalization of contractual terms, should also be mentioned the international rules for the interpretation of trade terms (INCOTERMS), developed by the International Chamber of Commerce in 1936
Deposit contract.- The deposit contract is governed by both the Civil Code and the Code of Commerce. Also, in many laws we find the relative to special deposits, and is a contract whereby the depositary is forced toward the depositor, to receive a thing, movable or immovable property, trusts him, and wait to recreate this when prompted by the depositor.
Regular Deposits.- there are no special rules on the personal items in the deposit contract if the exception is the article 2519 of the Civil Code of the Federal District which says: "The "inability of one of the contractors does not exempt the another of the "obligations to which they are subject to the deposit or the depositary", and the provisions of the article 2520 the same code that stipulates that "the "unable to accept the deposit, you can, if it is sued for damage and "damage, put as an exception the invalidity of the contract; more "cannot be exempted from restoring thing deposited if is still in "its power or the benefit they received from their disposal".
Uneven deposit.- The so-called irregular deposit has no application in practice, but as special irregular deposit, i.e. in the form of bank deposits. With these we shall study.
A) .- Bank deposits. Special deposits bank regulated by the banking legislation.
B) .- Deposits in general stores. Regulated by the Act of titles and credit transactions, articles 280 to 287 inclusive.
There are two classes: offers the classic form of deposit, other present procedures typical uneven deposit.
Deposit of individualized things.- this class of deposit requires the general warehouses to restore the same goods or goods in the state that they have been received, responding to his apparent conservation and damages arising out of this fault.
Deposit of goods or property individually designated.- The stores are forced to the custody of the goods or property deposited by the time that is stipulated as the duration of the deposit, and, if by cause that are not attributable to him, the goods or effects are broken down in conditions that can affect the safety or health, the department stores, with the intervention of corridor, or with the authorization of the offices of respective public health, may, without liability, to the sale or destruction of the goods or effects that it is.
General Bonded Warehouses. The concept and the classes of the same are legally specified in as soon as it is stated that the general warehouses of deposit will have as their object the storage, saved or conservation of goods or merchandise and the issuance of certificates of deposit and bonds of garment may also perform the processing of the goods.
Loan Agreement.- The loan contract is unusual, because that has been displaced by the loans offered by banks in its various forms, however, it is important to stay abreast of the elements that influence and determine the loan contract; to know the interests which it originates, the computation of income by arrears, capitalization of interest application of payments and the various statutory provisions which come from if any of the contractors committed any violation of the terms that contain the above contracts.
The contract of commercial loan in general, little practiced between traders and trading, all once again that in order to obtain the resources they need other means were used.
The loan is a contract that is perfected with the delivery of the thing borrowed, as a result, it is an actual contract.
It is a domain translative contract because it is made for the purpose of which is consumed the thing provided, that is, we will not use and returns the mass.
The loan can be of money, the titles in kind.
The money in the commercial loan works as always fungible thing, therefore, the debtor will pay by returning an amount equal to the received and if the payment is agreed in foreign currency, the alteration that suffers will be in harm or benefit of the service provider, notes the article 359 of the Code of Commerce.
The commercial loan.- the reputed commercial loan when it shrinks in the concept and with expression of the things that borrowed it is intended to acts of trade and not for needs outside of this. It is presumed that the loan commercial contracts between merchants.
I N C O T E R M S
In international trade has been held every day, with more intensity, to the use of a universal language, with regard to commercial transactions, the provisions on unfair trade practices, the United Nations Conventions on contracts for the International Sale of Goods, Prescription, commercial terms, etc. These last are characterized by acronyms or abbreviations that indicate their content cone be FOB, CIF, etc. Each one of them holds a set of obligations to be assumed by the parties, seller and buyer, involved in an international sale.
The Incoterms, also known as "price clauses", since each term allows you to determine the elements that make up in the price.
The Incoterms in its uniformity and extension reduce uncertainty arising from the multiple interpretations those countries with legislation, uses and different customs, usually due to commercial transactions, thus reducing misunderstandings which may terminate in a lawsuit, caused by:
A) .- Ignorance of the national law that should apply to the contracts.
B) .- Diversity of interpretations.
C) .- Poor information, with the consequent loss of time and money.
The Incoterms (International Commercial Terms), which is defined as a "set of rules applicable internationally intended to facilitate the interpretation of trade terms used in common".
The origin of the Incoterms lies in the development of world trade, which to operate in the international arena progressive facilitated the conceptualization of the agreements between the contracting parties, emptying in large part to contracts for the international sale of their national personality.
Its indication avoids the enumeration of the obligations of the parties and clearly establishes the time that verifies the transmission of the costs and risks from the seller to the buyer. That is to say, which varies with each condition of sale is the services negotiation (handling, transport, carrier, insurance, etc).
The selection of the Incoterm influences strongly on the cost of the contract. Although in the end, all the expenses or costs what ends paid for by the purchaser, this you must know, in addition to the stipulated in the contract of sale, which amounts to be disbursed and which are included in the price.
The order of the terms that includes the revision of 1980, is the following:
1) EXW ex-works (Factory)
2) FOR/FOT (Franco wagon)
3) FAS (free alongside ship)
4) FOB (free on board)
5) C&F (Cost and Freight)
6) Cost, Insurance and freight (CIF)
7) EXS Ex Ship (Franco on the ship)
8) EXQ Ex Quay (Franco on spring)
9) DAF - Delivered at Frontier (Delivered Free-)
10) DDP Delivered Duty Paid ( delivered free of rights)
11) FOB Airport (FOB Airport)
12) FRC Free Carrier (Franco Carrier)
13) DCP Freight/Carriage paid to (freight or postage paid until ... )
14) CIP Freight/Carriage and Insurance Paid to (freight, carriage and insurance paid up to ... )
LEGAL ORDER (FROM THE POSITION OF THE SELLER)
The terms have been arranged in 4 groups: "E", "F", "C" and "D" GROUPS "E", "F", "C" and "D" "E": In the local delivery of the seller.
EXW (Ex Works)
"F" delivery of the goods in a means of transportation hired by the buyer.
FCA (Free Carrier). Usable on any type of transport, including multimodal transport.
FAS (Free On Board). Usable for sea and inland waterway transport
FOB (Free On Board). Usable for sea and inland waterway transport.
"C": Delivery of the goods in a means of transportation hired by the buyer.
CFR (Cost and Freight). Usable for sea and inland waterway transport.)
CIF (Cost. Insurance and Freight) Usable for sea and inland waterway transport.
CPT (Carriage Paid To). Usable on any type of transport, including multimodal transport.
CIP (Carriage and insurance Paid To). Usable on any type of transport, including multimodal transport.
"D": The seller is responsible for the merchandise and must leave the expenses up to carry the same to the country of destination.
DAF (Delivered at Frontier). Usable on any type of transport. Specially railroad or highway.
DES (Delivered Ex Ship). Usable for sea and inland waterway transport.
DEQ (Delivered Ex Quay). Usable for sea and inland waterway transport.
DDU (Delivered Duty Unpaid). Usable on any type of transport.
DDP (Delivered Duty Paid). Usable on any type of transport.
As they move up to a condition of sale to another, in the order established in the Incoterms, increase the obligations of the seller and the decrease of the buyer.
MAIN FEATURES OF THE INCOTERMS:
The highlights on the international sale that are the subject of the Incoterms, refer to:
a) the delivery;
The delivery.- The delivery of the goods determines clearly what has been delivered, the place and the time in which we will verify the same.
The merchandise must be completely described in the contract, otherwise this may be declared invalid. It is also clearly establish the quantity or the criteria for determining it.
Claims for defects or defects of the goods should be made immediately after known. The period of claim can be stipulated in the contract or in the applicable law.
Generally the claims for damages, shortages in quantity or the quality it is difficult to solve.
When using the conditions of the Incoterms, you'll need to add the name of the city or port.
Clauses in the "C&F", "CIF", etc, the seller is the person who last the contract of carriage, being the documents (bills of lading, etc. ) you have to verify conclusively, the buyer, the fulfillment of the obligations assumed by seller in accordance with the contract of international sale.
The obligation of delivery is charged to the seller and will be accomplished when you have made all the acts that pertain to place the merchandise, subject of the contract, the buyer's disposal.
The Incoterms, in its various clauses, rules the conditions of delivery; however, the same can be the result of negotiations or be requirement for one of the parties. There are factors that determine the extent of the conditions.
The greater or lesser experience in buying or selling in the international arena is that the importer you prefer, for example, buy CIF and the less experienced exporter, and sell FOB.
The conditions of delivery depend on the context of the negotiation of the contract, the experience of the contracting parties and the final cost of the insurance and transport to destination.
At what time does the responsibility passes from the seller to the buyer?
Considering the diversity of national rights, it is common to give specific stipulations in the respective contracts. Without prejudice to the foregoing, included specific clause in the Incoterms in the contractual arrangements, these define precisely the conditions under which the transfer of risks on the basis of the relevant clause, regardless of the ownership of the goods, because this aspect is outside the scope of the Incoterms.
However while in the clause "Ex factory", the seller assumes no risk, in the clauses responsibility is on the rise, because it assumes the risk that the merchandise may suffer by the circumstances of the transport.
In the conditions that are indirect delivery, the transmission of risks takes place once delivered the goods to the carrier. In other words, the responsibility of the seller is more reduced, therefore does not assume the transport alternatives.
The Incoterms provide a solution to the problem of the transmission of the risks when this aspect is not dealt with comprehensively in the contracts.
Expenses.- Distribution of costs and risks of transmission are two situations specially treated in the Incoterms. In the normal execution of contracts, shall be the seller who bear the costs of the goods, until the time of the occurrence of the contractual compliance of the delivery.
All other expenses that the seller must assume, are accessories to the operation of delivery) direct or indirect).
In the operations with clauses "C&F" or "CIF", the seller must provide the buyer, without delay and at his own expense a bill of lading. The foregoing applies each time that the seller must make their own expense the contract of carriage. The Incoterms set, to express "freight or carriage paid to ... " that the seller" must, if it is the usual, facilitate the buyer the usual letter of porte, running with the expenditure".
The packaging.- In all the conditions of sale, it obligates the seller to provide the packaging of the goods required to meet the requirement for delivery, made by a transport in normal conditions, unless it is customary in the trade be trans-shipped without packaging (bulk goods).
The seller is responsible for the consequences arising from improper packaging.
The dangerous goods have an important international standards.
Three hundred dangerous products, classified in 9 categories have been cataloged by the United Nations and identified by means of a 4 digit code. The packagings to use, are classified into 3 groups:
Group I "very dangerous" .- brand X
Group II "moderately dangerous. "- brand Y
Group III" little dangerous" .- brand Z
Pallets.- Pallets are a charging unit, where packages are grouped on a platform. This facilitates the loading, storing, the count, the handling and distribution of the product.
The Container.- Is a bowl suitable for transportation of goods, and to be used in various means of transport, agile handling and easy filling and emptying. The concept does not include vehicles, the usual packaging.
The container is basic to the multimodal transport.
The full-container is called Full Container Load (FCL), where the merchandise travels from the beginning to the end without transshipment. This is the ideal way to use of the container.
In the course of carrying out a consolidated goods because the amount of these is less than useful volume of the ocean container, this will be called Less than a ocean container load (LCL) and merchandise to the transport the cargo (filling) and unloading (drain).
The "FCL" traveling from door to door. The "LCL" pier to pier.
PROCEEDINGS AND DOCUMENTS NECESSARY FOR THE RELEASE OF THE MERCHANTABILITY
The contract - a contract of international sale, always presupposes the compliance of a series of formalities that allow the output, the transport and introduction of the goods in the country of import.
The Incoterms governing the obligations of the parties in relation to the collection of the necessary documentation for the export of the goods (licenses, etc. ) and the subsequent import clearance (certificates of origin, consular invoices, etc). The scope of this obligation varies according to the marketing term that is used.
The Incoterm establishes that, when the buyer asks for it and to your account and risk, you are "provides all necessary assistance", to obtain the required documents for export or for the traffic of the merchandise back, according to the clause that the parties choose according to your needs.
With regard to the conditions "FOB", "C&F", "CIF" and "freight or carriage paid to ... " the seller must facilitate a merchandise "free to be exported". In these cases, the seller obtain rightful, at their own risk, the license for the export and any other similar authorization, as also pay the dues, fees and charges payable in the country of export.
In the clauses "Franco on ship" and "frank on spring", the seller shall carry out the formalities for export.
It will be assumed by the buyer, obtaining in the country of shipment of the certificate of origin and any other documentation required for the importation of the goods.
The documentary credit.- The instrument of international payment of goods more used, for the safety of offer to the parties, in the irrevocable documentary credit and confirmed.
The Freight Forwarder.- The Incoterms are applicable to the relations entities buyer and seller. None of its provisions directly or indirectly affects the relationships of them with the carrier, which are determined in the contract of carriage.
The provisions on the transport of merchandise establishes how the seller will fulfill if obligation to deliver the goods to the carrier.
"Transporter" means any person who, in a contract of carriage, undertakes to carry out or cause to be carried out a transport by rail, road, sea, air, inland waterways, or a combination of these modalities.
The carrier is the counterpart of a contract of carriage, pledging to carry out the transfer of goods by a certain means of transport.
The Contract of Carriage
Incoterms only deal with the commercial terms used in contracts of sale not saving any linkage, except the resemblance, with the terms used in contracts of carriage, especially as conditions of charter parties who are generally more specific in terms of costs of loading and unloading and the time available to perform these operations (clauses of delay).
There is now greater agility in the field of documentary practices bills of lading are replaced by documents "non-negotiable" similar to those used in other different modes of transport by sea.
We are talking about are way bills (maritime consignment note): liner way bills (consignment note of regular service); freight receipts (receipt of freight), etc. the limitation that presented these documents is that they are not suitable for the sale of goods in transit.
Optional nature of the Incoterms.- The commercial terms are also called "price clause", since the Incoterms in the various conditions of sale govern the concepts that make up the price to be paid by the buyer.
The Incoterms provide total freedom to the parties on the modalities of payment. It is to the contractual parties who corresponds accurately to predict in place, the form of payment, and in addition financial conditions (for example, interest rates for deferred payment).
Arbitration.- When the parties, by common agreement, hereby waive their right to resort to the justice and submitted to the solution of institutions or qualified people, is called arbitration.
In an almost unanimous, the legal systems of most countries allow the parties to a contract of international sale, choose the right to govern the contractual relationship.
The "Principle of autonomy of the parties", empowers the same to him choice of the right that are considered the most desirable: the country of the importer, the exporter or a third country.
The method faster, reliable and economical way to solve the problems that arise in the development of international commercial transactions and then that the direct instances failed, is arbitration.
If the parties agree to submit their disputes to arbitration, shall be bound by the arbitration decision, which will have the force of law and will be implemented in a manner similar to a court judgment.
The arbitration clause prevents, in principle, that the courts determining on a claim arising from the contract, except for reasons of public order, where a judge may refuse to the enforcement of a random award.
Also, arbitration decisions are subject to appeal.
However, the risk that a court declared null an award, is always present. In this regard is wise provide a warranty for damages in the course of such possibility.
The arbitration rules most known are: the United Nations Commission on International Trade Law adopted in 1976 the UNCITRAL arbitration rules; the Rules of Arbitration of the United Nations Economic Commission for Europe (UN/ECE Rules 1996); Uniform Rules of Procedure in the Courts of Arbitration of the Chambers of the Member Countries of the Council of Mutual Assistance (Rules of the COMECON in 1974); Rules of the Arbitration Association of the U.S.; Inter-American Rules of Arbitration. Many professional organizations have adopted their own Arbitration Rules.
The most widely used system is the arbitration of the International Chamber of Commerce that combines security and guarantees of institutional arbitration with the flexibility of the ad hoc arbitration.
CONVENTION OF THE UNITED NATIONS ON CONTRACTS FOR THE INTERNATIONAL SALE OF MERCHANDISE.
The convention of the United Nations on International Merchandise Purchase and Sale Contracts, subscribed in Vienna on April 11, 1980. Entered into force on 1 January 1988, a year after the deposit of ratification, acceptance, etc. (art. 99), by tenth country signatory state is responsible.
The convention is a set of uniform standards relating to the preparation of the contract, obligations and rights of the buyer, seller, transfer of risks, etc. , written in various languages, whose provisions have been studied and matched with diverse national interests and different legal traditions. Includes only the sale of goods in the international arena.
Therefore, those who make a contract of international sale, that is the main source of obligations of the parties, may be submitted:
a) to the national law of the seller country;
b) to the national law of the buyer country;
c) to the national law of a third country, chosen by common agreement;
d) the international conventions, such as the present commentary.
Scope of Application.- The Convention applies to contracts for the international sale of goods.
A contract is an agreement of wills, which are legally enforceable obligations for the parties. Its basic points are: the competent, content, consent, reciprocity of the obligations and, in some countries especially those with a legal system of the anglo-saxon tradition), a legal consideration on which is the element of exchange between the parties which can be measured or expressed in money. The contract is made with the consent.
International character of the Contract.- The Convention on the international sale of goods therefore; what are the legal criteria to determine "what international contract? These can be:
a) the address of the contracting or the of their establishments, to the extent that the parties are in different countries (art. 10, Inc. (b)
b) merchandise. If it is delivered in a country other than that was produced, extracted, harvested, etc. , or where he was at the time of the conclusion of the contract of sale.
c) The combination of the points a) and (b) above.
Interpretation.- For the interpretation of the themes that regulate the Convention, will be taken into account (art. 7 º )
a) its international character;
b) the uniformity in its application;
c) the observance of the "good faith" in the international trade;
d) the use that have been agreed or practices established between the parties (article..9 º)
Usages and practices of the parties.- another of the principles governing the interpretation of the Convention refers to the statements, or other acts of a party that must be understood according to its intent, or when the other party has ever known, or has not been able to ignore which is that intention (art. 8 º ).
Evidence of the contract.- it is not compulsory for the contract have to be concluded or evidenced in writing, and is not subject to other requirement as to form and may be proved by any means, including witnesses. However, a written contract, to ensure that any modification or termination by mutual agreement shall be in writing, it may not be altered or terminated by mutual agreement, in another way.
It sets the expression "in writing" includes telegram and telex (art. 13).
FORMATION OF THE CONTRACT
SUPPLY.- The contract for the international sale of goods it can be concluded as a result of the acceptance of an offer or be the result of prior negotiations, of which, usually arise deals, letter intention, etc.
Revocability.- The revocability of the offer includes the following features (arts. 16 and 17):
1) Can be removed, if this decision reaches the offeror before or at the same time as the offer, even if it was issued as a matter of irrevocable.
2) May be revoked, if it reaches the offeror before he has sent the acceptance.
3) The offer may not be revoked:
a) without indicates, to point out a fixed time for acceptance or otherwise, that it is irrevocable;
b) if the recipient might reasonably consider that the supply was irrevocable and have acted on the basis of that offer.
4) Shall be extinguished when their rejection reaches the offeror, although the same irrevocable (art. 19, Point 1, and 20 point 1).
Reception.- In the previous points affirms the criterion of "reception" of communication, where neither supply nor the acceptance are binding at the time of dispatch, but reaches the recipient, except for point 2, where sending the acceptance invalidates the revocation.
The counteroffer.- acceptance of an offer with additions, modifications, etc. , were considered as a rejection of the same and will be a counter-offer, unless what additions or changes do not alter substantially the supply and these are not contested by the bidder (art. 19).
In this case, the contract consists of the offer adjusted with the additional elements which do not change substantially the same.
Communication.- according to the medium used for communication, the computation of the start of the period of acceptance of an offer, when not determines a date certain(for example, 7 November), is the following:
a) Telegram: when it is delivered to your expedition.
b) Letter: from the date that indicates. In the absence of this from that shown on the envelope.
c) Phone, telex or other means of instantaneous communication: from the moment that the offer reaches the offeror.
Article 20 to establish the period of acceptance includes a fax, which he calls "other means of instant communication".
Late acceptance.- The late acceptance shall take effect as if the bidder, without delay sends a communication or reporting orally to the addressee.
Offer – Contract
Acceptance.- Any statement or other act of recipient indicating assent to an offer constitutes acceptance (art. 18), to the extent that you do not change essentially the offer.
When the offer the statement of the acceptance or other manifestation of intent, you have acceptance period, this should "reach", within this period. If it does not have established time period, the acceptance must "reach", in a reasonable time (art. 18, Paragraph 24).
The contract of sale will be refined in the time to have effect the acceptance of the offer (art. 23), passing the conditions of the offer integrate the clauses of the contract. The sample.- The seller can deliver, together with the offer, a sample or model.
If accepted the offer and subscribe to the contract of sale, the sample is not the same, without prejudice to the contract will include a full description that allows us to monitor the quality of the product that receives the buyer.
SALE OF MERCHANDISE
The realization of a sales contract comprises the step of the property ( "transfer of title") and the possession of the goods ( "delivery" from the seller to the buyer).
The buyer can for example, to enter into possession of the goods and the property remain in the hands of the seller, because the contract stipulates that, previously, had been paid those in its entirety.
The "passing of the risk" corresponds to the time in that the responsibility for the goods; pass from the seller to the buyer.
The most appropriate instrument for the recovery of exports is the letter of credit, irrevocable and confirmed.
BREACH OF CONTRACT.- The breach of contract by one of the parties, to be "essential" causes the resolution of the contract, when cause to the other party such a prejudice that substantially deprived of what it was entitled to expect under the contract (art. 25).
The Convention seeks to avoid reaching the end of the contract, severely punished to the non-performing party. Its purpose is to give assurances to the parties, by providing the means to continue the contract.
As relevant, the art. 74 (Damages) said " ... this compensation may not exceed the loss which the party is breach had foreseen at the time of the conclusion of the contract, taking into account the facts of that knew or ought to have known at that time, such as potential consequence of the breach of contract".
The declaration of avoidance of the contract is not automatic. Legal effect if only communicates to the other party, in order that the same do not proceed with the contract, eliminating or decreasing expenses and expectations of business (arts. 61 and 26).
The parties by common accord, can be set in the contract the automatism of the resolution, are need to notify the other party.
SPECIFIC COMPLIANCE.- Each part of the contract may require the other fulfillment of the obligations agreed.
The agility that requires of international trade leads, in the absence of one of the parties, the "specific performance" is resolved with a replacement purchase or sale of replacement, reserving the part affected the demand for the damage caused.
OBLIGATIONS OF THE SELLER
BASIC OBLIGATIONS.- The seller must comply with government regulations regarding the requirements for export (licenses, prior authorizations, quotas, etc. ) and, furthermore, has the following obligations (art. 30):
a) transferring ownership of the goods (art. 4 º, item 6) ;
b) deliver the goods (place and time) ;
c) deliver the documents related to the goods (place time).
The Convention considers the transfer of ownership, as an obligation of the seller. If the seller does not comply with it, it will be the responsibility of the buyer damages actions, according to the articles 71 to 74.
In this regard, the contract is normally include clause of retention of ownership until its collection in order to allow the recovery of the well expressed by party or its owner on the assumption that the buyer of the exterior does not pay.
RIGHTS OF THIRD PARTIES.- It can happen that the legal title to the merchandise this subordinated to the right of a third party, such as the case of a garment.
DOCUMENTS.- With regard to the documents related to the goods, the seller is obligated to deliver them at the time, in the place and in the manner set out in the contract. The clauses of the Incoterms, have in this regard.
DELIVERY OF THE MERCHANTABILITY AND DOCUMENTS.- The act of delivery, leads us to establish: the merchandise of the contract; the place; the moment and the relevant documents (arts. 31 to 34).
The Merchandise.- The offer invoice pro- form as well as the contract will have to describe, indicate and/or define with clarity the goods that are sold and the amount that is subject to transaction or the criteria for determine it in particular when it refers to a type of merchandise.
The quality has to correspond to the samples, models, etc. , and/or to the description contained in the body of the contract or in the annex to the same.
The documents.- The documents to which you are kingdom in law, are called securities. Includes negotiable instruments and documents related to ownership of the goods. Titles can be: to order, nominative or bearer.
The most important document in foreign trade, is the Bill of Lading. Test the dispatch of the goods and must submit to take possession of the same.
It extends to the carrier or its agent and contains the conditions to which it conforms the contract of carriage.
This document can be extended with the following conditions:
a) "on board": when is issued after the merchandise placed on international maritime transport;
b) " received for shipment": when the merchandise has been received for transport to the outside;
c) "combined": is issued when exist several modes of transport.
Other means of transport gives rise to the following documents: the Porte Air Charter or air waybill, Consignment Note by rail or road; Bill of Lading river or lake.
The documents cited are the proof of a contract of carriage between the seller and the carrier and/or agent.
The certificate of origin intended to prove that the goods described in the certificate, complies with the requirements of origin according to the relevant rules of the regime that invoke (ALADI, GSP, etc. ).
Quality Certificate or analysis, certificate or Packing List, Certificate of disinfection, etc. , are other many documents used between the parties intended to transfer the property, to remotely control the requirements have been met by the purchaser or requested by the buyer or requested by the buyer for the transit and import of the goods.
THE PLACE OF DELIVERY.- The seller must deliver the goods in the place of common agreement in the contract.
The goods delivered to the carrier must be "perfectly identified" through marks or signs and/or on the shipping documents etc.
In the event that the goods they are not "perfectly identified", the seller shall send the buyer a notice of issuance in the specifying the goods (bulk shipments).
DELIVERY TIME.- The delivery of the goods is governed by the following provisions, in accordance with the contract (art. 33):
EARLY DELIVERY. THE LACK OF CONFORMITY.- early delivery may correspond to the documents and/or merchandise. In the case of documents, the delivery in advance by the seller and until the time fixed for the delivery lets you overcome any lack of conformity of documents, if the exercise of this right does not cause inconvenience to the buyer not excessive spending.
The contract shall establish guidelines which the seller must comply with regard to the delivery of the goods, especially as it pertains to (arts. 34 and 35):
d) containers and packaging.
In the absence of contractual provision, the parties shall be forwarded to the usages and customs.
TERM.- The buyer loses the right to invoke the lack of conformity of the goods, if he does not give notice to the seller, specified its nature (type of failure, measures that claim the buyer), within a reasonable period of time in which the Hague or should have discovered.
If the complaint is not addressed immediately or within a reasonable time, the buyer loses the right to invoke the lack of conformity, not having rights to goods in replacement, cancellation of the contract, price reduction and damages (arts. 46, 49, 50, 74 and 76)
In all cases, the buyer loses the right to invoke the lack of conformity; or do not inform the seller in:
A) 2 years: expiry date, limited by "reasonable time". Set out the circumstances, the judge can set a deadline of expiration less than 2 years.
B) 4 years: deadline for sue. Convention on Contracts for the International Sale of Goods or, in his absence, the prescription (term) applicable in accordance with the rules of private international law.
The term must be counted from the date on which the goods were actually in the hands of the buyer, unless that term is incompatible with a contractual warranty period.
REVIEW OF THE MERCHANTABILITY.- The purchaser must review or make them goods in the shortest possible time, in the circumstances of the case. If the contract involves carriage of the goods, the examination may be postponed until they have reached their destination (art. 38).
Alternatively, if the buyer changes in transit the destination of the goods or the reroutes without having had the chance to examine them, and the seller was at the time of the conclusion of the contract, knowledge of such a change of destination or dispatch, the examination may be deferred until the goods have arrived at their new destination.
RIGHTS AND ACTIONS IN CASE OF BREACH OF CONTRACT BY THE SELLER.
In most cases, the actions for which the buyer has the right, can exercise the seller, when it is the buyer who does not comply with its contractual obligations.
Rights of the buyer.- The contracts are concluded to be met. If the seller does not meet any of its obligations under the contract or the Convention (arts. 30 and after), the buyer may exercise the following rights (art. 42, Item 2):
a) damages (art. 45, Item 2.74 and 77) .
b) enforcement of the obligation if it has not been completed (art.46, point 1) .
c) Delivery of the goods not in accordance with the contract (art. 46 Point2): require other goods in replacement of those.
d) deliveries of goods faulty: requiring that they be repaired (art. 46, Item 3) .
e) delivery of defective merchandise: when you can't be repaired, taking into account all the circumstances, you will be able to apply (art. 46, Item 3) :
e,1) rebate price )art.50) ;
e,2) differ the fulfillment of obligations (art.71) ;
e,3) action for damages (art. 45, Item 2) .
f) fixing an additional period of time of reasonable length for which the seller complies with the obligations that the incumbent (art. 47, Item 1) .
g) Resolution of contract:
g,1) by "fundamental breach" (art. 49, Point 1, a] ) ;
g,2) non-compliance with additional time due to a lack of dedication in term (art. 49, Point 1,b] ) ;
g,3) in advance, before the compliance date, if it is clear that one of the parties does not comply.
The noncompliance.- If the breach is not essential would lead to the compensatory action for damages and the action of breach of contract.
6,11,3. Fundamental Breach.- occur that the goods received by the buyer were not in conformity with the contract and constituting this a "fundamental breach" (art. 25 The buyer may:
(a) terminate the contract, despite the fact that the seller wants to remedy their lack (art. 48, 49, point 1, a], 64, point 1,a] ), or
(b) require the delivery of other goods in replacement of that, in the cases in which, because of a lack of conformity, verified a fundamental breach of contract (art. 46, Item 2).
Grace Period.- When the seller is delayed to meet its contractual obligations, the buyer may grant him an additional period (grace period).
That period shall be reasonable, referred to the urgency of the buyer and the cause as invoked by the seller.
During the grace period the buyer may not bring any action for breach of contract, unless the seller tells you that does not comply with the extent to which it is concerned (delivery of the goods, delivery of documents, making repairs, etc. ), in that period (art. 47, Item 2).
Request for compliance.- For the achievement of this goal, the seller, with the approval of the buyer, even after the date of delivery, you can remedy at their own expense any breach of its obligations.
This is feasible if you can do this:
a) without undue delay;
b) without causing unreasonable inconvenience (the purchaser)
c) without cause uncertainty, with regard to reimbursement by the seller of the anticipated expenses by the buyer.
Resolution.- The last stage in the development of alternatives of the contract, is its resolution.
The buyer may declare the contract avoided:
a) If the seller has engaged in "fundamental breach" of the contract.
b) in case of non-delivery of the merchandise, if the seller does not perform within the deadline set by the purchaser.
c), or if he declares that it will not deliver within the time limit set.
The resolution is not automatic, requires an explicit statement of the buyer.
Lowering the price.- The seller must deliver goods which are of the quantity, quality and type, corresponding to the provisions of the contract and that they are packed in accordance with the agreed.
In the development of the operation may occur that the goods delivered is not in conformity with the contract.
In this course, the buyer may reduce the price proportionately the difference existing between the value of the goods delivered were defective in form at the time of the act and the value that would have had at that time goods.
OBLIGATIONS OF THE BUYER
PAYMENT OF THE PRICE.- The buyer, must receive the merchandise, and fill out all the existing regulations to avoid difficulties in payment of the price and transfer to the outside of the amount due in the agreed currency (arts. 53 and 54)
The price must be true and be established in the contract or may be indeterminate, without affecting the validity of the contract.
The seller has an obligation to deliver the goods at the place and in the date or time limits. Together with the buyer
a) As the obligation to pay the price in the agreed conditions and receive the goods in conformity with the contract and to the provisions of the Convention
b) it is in the interest of the buyer insurance corresponding
c) to set a time limit of delivery, if the buyer is reserved the right (art. 33, Inc. , b] ) ;
d) review or to examine the goods in the shortest possible time )art. 38) ;
e) communicating to the seller, within a reasonable time, the lack of conformity of the goods and, in the shorter term, the existence or claim of third (art. 43).
Not essential compliance.- If the breach is not essential, the risk is transmitted when the goods are handed over to the first carrier (art. 67). In this course, the buyer can reduce the price (art. 50) and claim damages (art. 45, Item 2)
In the case of defective goods, seek redress.
PROVISIONS COMMON TO THE OBLIGATIONS OF THE SELLER AND THE BUYER
POSTPONEMENT OF THE OBLIGATIONS.- Any of the parties may differ from the fulfillment of their obligations (payment, delivery of the goods, etc), if, after the conclusion of the contract it is apparent, in situations and public notaries )for example, a call for creditors), which the other party does not play a substantial part of their obligations.
FUNDAMENTAL BREACH.- In the case that it is clear that one of the parties incurred in "fundamental breach" of the contract, attentive that was submitted in contest preventive bankruptcy, offered guarantees or insurance or bonding insufficient or there are other situations which would adversely affect the employer heritage, the other party may declare the contract avoided in advance.
INDEMNIFICATION FOR DAMAGES - compensation for damages for breach of contract protects to the injured party in order that their situation would be like if it met the provision.
The compensation shall include the value of the loss, including loss of profit, suffered and has a limit:
PURCHASE OR SALE OF REPLACEMENT.- If after the resolution of the contract, within a time limit and in a reasonable manner, the buyer makes a purchase of replacement or the seller a sale of replacement.
There is a current price of the goods, you will be able to get the difference between the price mentioned in the contract and the current at the time of the resolution.
It may happen that the resolution takes place after having been in charge of the merchandise. In this course we will apply the price current at the time of the resolution.
REASONABLE MEASURES.- The part that invoke the breach of contract must take such measures as are reasonable necessary, under the circumstances, to reduce the loss, including loss of profits, resulting from the breach.
If you do not perform such acts, the other party may ask that reduce compensation for damages in the amount that should have reduced the loss.
INTERESTS.- The non-payment of the price any sums owed by the buyer shall determine that the seller has the right to collect interest, without prejudice to the compensatory actions for damages.
The seller, if he is obliged to reimburse the price, you must also pay the corresponding interests, from the date on which payment was made.
The Convention provides neither method nor rate applicable for the calculation of interests.
Contractually will they be able to establish a payment currency, interest rate and applicable rate, all this attentive to the legislation will change by the governing economic authorities of the countries that belong to the parties.
WAIVER.- The convention rule exemption, that is to say, exceptions to invoke for the non-performing party to be exempted by the non-infringement of its obligations.
A party shall not be responsible for the lack of compliance (made their fortune or force majeure) of any of its obligations, if you test that the lack of compliance is due to an impediment or its consequences at the time of conclusion of the contract, which avoided or excels, although this generates unplanned expenses.
The contract shall indicate the unpredictable nature of events and/or unsustainable which the parties regard as of force majeure, the tests that are required to make the procedures for notification of such events and their effects, for example, extension of the delivery date or cancellation of the contract.
EFFECTS OF THE RESOLUTION.- Resolved the contract, the two parties are released from their obligations, except the damages that may be due to the injured party.
The provisions on arbitration or similar provision, it will not be affected by the termination of the contract.
The party that has fully or partially complied with the contract may apply to the other party the restitution of what has been supplied or paid. If both parties are bound to return the relevant, this act must be performed simultaneously.
CONSERVATION OF THE MERCHANDISE.- If the buyer is delay in the receipt of the merchandise or pay the price, when this act and the delivery of the goods must be made simultaneously, the seller, if you have or is in possession of the goods, shall take appropriate measures for their conservation, taking into account the circumstances of the case.
It shall have the right to retain the goods until you have obtained the buyer the reimbursement of expenses incurred.
If the buyer has received the merchandise, and intends to reject it in accordance with contractual provisions or of the Convention shall, according to the circumstances, shall adopt reasonable measures for their conservation.
The compliance and the contractual provisions.- The parties must exercise extreme analysis of their respective rights, especially, the conditions on the passage of the property, delivery terms, warranties, etc. , in order to the clauses that protect the unconscionably that composes the contract.
In this regard may indicate one of the following cases:
a) exemption from liability in the event of gross negligence;
b) tolerance in defective products by quality exceeding the legal limit;
c) deliveries outside of term that does not mean a fundamental breach, except special situations;
d) or exclude rights most common legal actions in case of failure;
e) include clauses of a general nature that reject the obligation to pay compensation for damages or increase beyond what is reasonable.
In this regard is usually agrees in the contract an estimate of damages to be paid in the event of a breach of the contract.
THE DOCUMENTARY CREDIT IN MEXICO
(THE LETTER OF CREDIT HOME)
DOCUMENTARY CREDIT BACKGROUND.- Traders devised an instrument which would assure you of both the sale of the property as payment of the price. It was the sale of documents, a business that takes place between parties whose places are located in different places, own of the maritime traffic "transoceanic", and the basis of which it is located in the representational function of such documents, so that its holder (documents) assists him the exclusive right to obtain delivery of the goods from the person who transports.
The documentary credit has been named in a variety of ways: credit documented, documentary credit, accreditation and, payment through banking delegation, banking credit documentary letter of credit, commercial credit, commercial letters of credit, credit documented for reimbursement, etc.
In accordance with the rules and usages Uniform (UCP) the documentary credit is the one under which a bank (sender), acting at the request and in accordance with the instructions of a customer (originator) is bound to: make a payment to a third party (the beneficiary) or to your order; or to pay, or to negotiate the accept bills of exchange ( "drawings") that free the beneficiary; to permit those payments are carried out or that such turns are paid, accepted or negotiated by another bank, against Delivery of the documents required, provided that the credit terms and conditions are met.
The Mexican law only recognizes the credit confirmed, which according to article 317 of the LGTOC, sending the grants as direct obligation toward a third party, in writing, and cannot be revoked by the requested credit. Obviously not supplied any concept of documentary credits and in addition to superficial way, regulates a species of them, the confirmed that even comes to confuse with irrevocable.
These credits in accordance with the UCP should be held by written like that in Mexico (article 317 LGTOC), and although none of the two systems requires the signature of the seconding it constitutes not only a conventional means to identify the personality of the bank and its component, but also as a tool to demonstrate that actually existed consent for the issuance of credit.
PERSONAL ITEMS.- The parties in the documentary credit are two: the originator or computer on the credit (or thinness accredited buyer) and the credit of the issuing bank or lender, giver; that requests and contract with the credit institution the opening of documentary credit in favor of a third party (the beneficiary, usually seller), whose legal relationship with this Bank derives from the unilateral obligation and abstract of the own bank issuer of the credit; since then always concerned of a irrevocable credit.
The other part is the Bank, who through the opening of the documentary credit is obliged to pay a sum of money to the person indicating the accredited and in the name of this, or pay, accept or negotiate the credit titles that the third party will present against the delivery of the documents representing the goods or those established in the documentary credit.
CLASSIFICATION.- documentary credits can be classified taking into account various criteria in the following manner:
A. According to the obligation assumed by the issuer (Bank) of the credit with respect to the beneficiary are classified into revocable and irrevocable.
Revocable.- These are loans that do not breed any legal calculation between the Mangalore of the credit Bank and the beneficiary.
Irrevocable.- The irrevocable credit constitutes a firm commitment on the part of the issuing bank and the obligation of the same with regard to the recipient (and to the holders of good faith of the bill of exchange), to comply with the terms of payment, acceptance or negotiation provided for in the opening credit, provided that the documents or possibly in the documents and letters submitted are in accordance with the data and conditions of the loan (article 5 UCP); this credit cannot be canceled or amended without the consent of the interested (Bank, beneficiary and originator).
In this order of ideas we can express, with the UCP (article 3) that the credit is irrevocable and firm commitment on the part of the issuing bank, subject to compliance with the terms and conditions set forth in the credit of: (a) pay or that the payment is made if the credit is usable for payment against delivery of the turn or not; (b) accept turns, if the credit is usable by acceptance of the issuing bank or to assume responsibility for the acceptance and payment at maturity if the credit is usable by acceptance of turns to the originator of the credit or any other waged referred to in the credit; c) Purchase, negotiate, without recourse against the facts and/or holders of good faith of turns left to the view or in installments by the beneficiary, to the originator or of any other waged specified in the credit or to ensure the purchase or negotiation by another bank, if the credit is usable purchase/negotiation.
B. According to the way of reporting the credit to the beneficiary, the credits were classified as follows: 1. Confirmed; 2. Specially advised; 3. Circular Credits.
1.- Confirmed. The confirmed credit is the only documentary governed by our LGTOC, is characterized by the involved at least two banks, the first thing is the issuer of the credit and requests the second confirm the credit, and this that deals with confirm it with the result that in addition to the firm commitment of the issuing bank, enters into another commitment, the confirmation of that warns and confirms the credit under its own responsibility (firm commitment additional to that of the issuing bank).
OBLIGATIONS OF THE CONFIRMER.- The obligations of the Bank that accepts and confirms the credit are those of (article 4 (c):
A) Pay if the loan is payable in their own boxes against delivery or not of a turn, or that the payment will be made, if the credit is usable but in another place.
B) Buy or negotiate without recourse against the drawer and/or holders of good faith, turns left by the recipient, in the view or the term, to charge the sender or originator or any other drawer specified in the credit, if the credit is usable but in another place.
C) .- Buy or negotiate without recourse against the drawer and/or holders of good faith, turns left by the beneficiary to the view or term in charge of the sender or originator or any other waged specified in the credit, if the credit is usable by purchase / negotiation and
D) Accept the turns, if the credit is usable by acceptance of the confirming bank, in their boxes, or to assume responsibility for the acceptance of the drawings and the payment at maturity, if the credit is usable by the acceptance of turns to the originator or of any other specific drawer or in credit. 2. Specially advised. This is a documentary credit whose feature lies in the fact that the recipient is advised especially by the correspondent of the issuer.
3. Circular Credits. It is a documentary credit in which a bank intervenes only, the issuer of the credit, who directly signals of the same of the same to the beneficiary.
C. Depending on whether the credit is transferable or not, the loans can be: 1. Transferable; 2. Non-transferable.
1. Transferables. These are loans that allow you to replace the beneficiary for another person in the discharge of the underlying obligation.
2. Non-transferable. As its name indicates it is credits which may be transferred, that is to say, in which the recipient cannot be replaced by another person; as noted above, the UCP establishes the presumption that the documentary credits are not transferable, unless otherwise agreed.
D. According to certain characteristics the loans can be:
1. Single submission;
2. multiple presentations (revolving) ;
5. Of housing (letter to the view) or at the sight;
6. Acceptance or deadlines;
7. Red Clause;
8. Green Clause;
The credits to view are payable to the submission of the appropriate rotation and the shipping documents, provided that they meet the requirements stipulated in the credit.
The term loans or with deferred payment on acceptance, are characterized because the recipient submits documents and instead of receiving the payment receives turns or letters accepted by the issuing bank, its correspondent or correct (thinness to view 90 days), which can be discounted by the beneficiary at your bank.
As regards the appropriations funded, the bank pays the beneficiary in usage of credit lines granted prior to the originator of the loan.
SUBSIDIARY CREDITS.- Also known as secondary or back to back the subsidiary documentary credits allow the beneficiary (thinness seller) use the original credit as a guarantee for the opening of a second documentary credit bearing a new payee, which generally is supplier of the goods or of the inputs for the associate; there is common interest in the parties.