1. What type of contract is expected to be concluded.
That is, a contract for the supply of goods, provision of services, performance of work, transfer of software licenses, a mixed contract for goods and services, a distribution contract, a compensation agreement, Team work etc. The solution to this issue determines the mandatory details of the contract, document flow under the contract, additional costs and income under the contract, customs, tax and other consequences.
2. Will the contract be one-time (for the supply of one batch of goods, one-time performance of work or services, etc.) or a framework one.
3. Is it expected to conclude a specific contract with one foreign partner or a general (standard, basic) contract with different potential partners. From which countries are contract partners expected?
4. Is the foreign partner under the contract an independent contractor or an entity affiliated with you (a subsidiary, your offshore company, etc.).
A contract with “one’s own” foreign company actually transfers work under the contract to the level of compliance with formalities in the Russian Federation. For contracts with independent foreign partners, on the contrary, the commercial terms of the transaction and problems due to the difference in mentality of the partners are of primary importance. However, all this is also influenced by the requirements of currency, customs, and tax legislation of the Russian Federation.
5. Whether a particular potential foreign partner is a fraudster.
If it turns out that the partner is a fraudster, and there are many of them in the field of foreign economic activity, then all the work under the contract with him will not make sense. To check, you can evaluate your partner’s behavior and correspondence with him for signs of fraud, request registration information about him from information agencies (see, for example, www.dnb.ru), Chamber of Commerce and Industry, information from exhibitions, visit his office or enterprise, etc. Sometimes this problem is identified after repeated negotiations, so it must be taken into account after the conclusion of the contract.
6. Are there any proposals for a draft contract from a foreign partner (partners) and your attitude towards them.
That is, do you agree with the partner’s terms, possible objections, conditions that are important to you. These terms may also be contained in correspondence with your partner. This is one of the most time-consuming parts of working on a contract.
7. What will be the languages of the contract and the language of correspondence under the contract.
8. Name of goods, works, services, licenses, activities under the contract.
8.1. Are goods, services, works, intellectual property (IP) objects under the contract subject to any prohibitions and restrictions in the Russian Federation?
This may be mandatory certification of goods, licenses and quotas for import into the Russian Federation or export of goods from the Russian Federation, etc.
8.2. Are there any benefits in the Russian Federation for goods, services, works, or IP objects under a contract and what conditions must be met to receive them?
9. What amounts will be “at risk” under the contract.
In other words, this is the approximate total amount of the contract and the amount of possible losses and income / profit. Commercial cooperation for different amounts has different patterns that cannot be ignored in the contract.
10. What will be service organizations in connection with the contract - will there be a broker, forwarder, etc. Will the contract be related to other contracts for your foreign trade project.
For example, the transport terms of the contract must correspond to the contract for chartering a vessel, etc.
11. What tasks and goals are expected to be achieved under the contract.
For what purposes will my participation be required, what issues do you intend to resolve on your own?
12. Have (open) a foreign currency account in a bank and obtain document forms for foreign exchange transactions from the bank’s foreign exchange control department. As a rule, payments are made in euros and US dollars, for which the following documents are required:
Certificate of foreign exchange transactions
Certificate of supporting documents
Order (application) for the purchase of currency
Order (application) for currency transfer
If legal services are needed to resolve the above issues, see Legal development of foreign trade projects.
From a legal point of view, each type of foreign trade (commercial) contract has its own essential conditions, without the agreement of which the contract is considered unconcluded. In the narrow sense of the word, these essential conditions can be considered mandatory details of the contract. For example, under an ordinary contract for the sale and purchase of goods, international law establishes only two essential conditions: 1) the name of the goods and 2) the quantity of goods. It is assumed that the price of goods, if not specified in the contract, can be determined by the prices for similar goods charged under comparable circumstances.
However, in practice, foreign trade contracts have a number of additional mandatory details. For customs purposes, such details are the characteristics and description of goods, since they are used to determine the HS codes of goods, which serve as the legal basis for the collection of customs duties, the bases (basic conditions) of delivery according to Incoterms and the prices of goods, on the basis of which the customs value of goods is determined. For the purposes of currency legislation, regulatory authorities often consider the terms of delivery of goods, provision of services, performance of work, transfer of results of intellectual activity, as well as payment terms to be essential terms of contracts, since the law on currency regulation and exchange control (Article 19) refers to the obligation residents to ensure receipt of goods, services, works, results of operations or return of currency “within the time period established by the contract.”
In addition, to mandatory details contracts can also include purely formal details: written form of the contract, names and addresses of the parties, currency details for payments, presence of signatures of representatives of the parties, seals of the Russian side (foreign partners often do not have a seal), date of the contract.
The usual requirements of banks, customs and tax authorities for foreign trade contracts can be considered unique mandatory details. For example, bank details for payments should be indicated not only in the final clause of the contract, but also in the payment clause. As a rule, a contract must have penalties, provisions on claims, have an economically reasonable purpose and procedure for execution, a place of signing, etc.
For control purposes in the Russian Federation, all these features are reflected in the Recommendations on the minimum requirements for mandatory details and the form of foreign trade contracts, sent by letter of the Central Bank of the Russian Federation dated July 15, 1996 No. 300. Although these Recommendations are not mandatory, their compliance allows us to minimize many problems with contracts in banks, customs, and tax authorities. However, the Recommendations should not be taken literally; some of their provisions are clearly outdated, for example, references to Incoterms-90, recommendations to indicate currency codes and product packaging codes in the contract.
Finally, if the parties agree to include any additional essential conditions, then such conditions with the status of “material” will also become mandatory conditions(details) of the relevant contract between these parties.
Structurally, foreign trade contracts usually consist of a preamble, which contains information about the parties to the contract and their representatives, and articles, divided into paragraphs, which set out the actual terms of the contract. The closing clause usually contains the contact details and bank details of the parties. Sometimes the preamble sets out the parties' statements about their reasons for entering into the contract. Individual large sections of the contract may be drawn up as annexes to the contract, in which case such annexes should not have their own date and place of signature, since they are considered integral parts of the contract.
The content of the contract is the conditions and algorithms for cooperation between the parties, supply of goods, provision of services, performance of work, transfer of licenses, payments, acceptance, claims, force majeure, arbitration, etc. The minimum recommended conditions are listed in the above-mentioned Recommendations of the Central Bank and Customs. Naturally, in foreign trade contracts for the provision of services, performance of work, transfer of licenses, some of these conditions are not used, but other conditions necessary for the corresponding type of contract are added. On the other hand, detailing all such conditions and including additional conditions in the contract can radically change the content of the “minimum” contract. Depending on your goals and objectives under the contract, the following sections may become separate large blocks of legal issues under the contract:
Algorithms for the supply of goods, provision of services, performance of work
Conditions on the quality of goods
Monetary and financial conditions
Conditions on the scope of rights under the license
Conditions for acceptance of goods, works, services
Terms of claims and liability
Guarantees of fulfillment of obligations
Warranty obligations of the seller, manufacturer
Documents and document flow under the contract
When translating contracts from/to English, distortions inevitably arise to one degree or another due to the presence in the languages of so-called non-equivalent vocabulary that does not have direct correspondence in the target language, and due to other linguistic features, for example, inconsistent terminology, the presence of concepts that in one language are expressed in one word or phrase, and in another are described in several sentences, etc.
Preparing a contract simultaneously in two languages differs significantly from first drafting it in one language and then translating it into another language. Advantages of a bilingual approach:
More high level equivalence of two contract texts by eliminating non-equivalent vocabulary and selecting established translation correspondences
Correct use of contract terminology Russian/English.
Detailing of concepts that are little known or incomprehensible to one of the parties to the contract
More high speed contract preparation
This procedure is not established by law. Some justification for issuing bilingual documents can be found in the order of the Ministry of Justice Russian Federation dated March 15, 2000 No. 91 “On approval of Methodological Recommendations for the performance of certain types of notarial acts by notaries of the Russian Federation”, which states:
"40. If, when performing a notarial act (certifying a transaction, certifying the accuracy of a copy, etc.), a translation into another language is simultaneously performed, then the translation and the original text can be placed on one page, separated by a vertical line in such a way that the original text is placed "on the left side, and the translation - on the right. The entire text of the document is translated, including the signature and seal. If the translation is made by a translator, his signature is placed under the translation. The certification inscription is stated under the texts of the document and the translation from it."
In practice, contract texts in different languages are placed on one page, separated by a vertical line. The translator’s signature is not affixed, since it is considered that the parties, with their signatures, certify the authenticity and legal force of the contract in different languages, by virtue of such an agreement between them. As a rule, the contract specifies which text takes precedence in the event of discrepancies. Options are possible when both texts have equal legal force, or when one of the texts has only informational value. However, if such an “informational” text of the contract is Russian, then such a condition of the contract may lead to problems at the bank and at customs.
Strictly speaking, the types and number of problems that may arise under a foreign trade contract are not limited. However, the most serious and most common problems can be identified. From the point of view of the commercial relations of the parties, the most sensitive ones are usually financial losses or additional income caused by certain provisions of the contract. For details of these provisions, see the page
Of course, possible contractual problems with a foreign partner are not limited to financial consequences. There may be damage to reputation, lost time negotiating with scammers, unreasonable disagreements, misunderstandings, the need to change the contract, re-issue documents, etc.
On the other side, possible problems under contract in relations with the regulatory authorities of the Russian Federation are no less numerous, their lists can be found on the pages:
In each specific situation under a foreign trade project, these problems and the likelihood of their occurrence are different. Therefore, it is important to decide in advance which issues in your contract will be most relevant and focus on them.
Based on the practice of foreign economic activity, there are certain methods for avoiding or resolving such problems under contracts, which are offered as part of the service for drawing up foreign economic activity contracts.
Often contracts are concluded at a meeting of representatives of the parties. In this case, it is advisable to indicate in the contract only one date of signing and at the same time the place of signing.
If a contract is concluded by mail, the contract is considered concluded at the moment the party that sent the offer (a contract signed on its part) receives its acceptance (a contract also signed by the other party). Acceptance must be complete and unconditional. Acceptance must be received within the period specified in the offer. Otherwise, disagreements arise about whether the contract was concluded, in what edition, etc.
The conclusion of foreign trade contracts with an electronic digital signature is not yet used in Russian foreign trade practice for a number of reasons. Instead, sending documents by e-mail in scanned form serves as a successful replacement for faxing. The legal justification for this practice can be considered paragraph 2 of Article 434 of the Civil Code of the Russian Federation, which states:
"2. An agreement in writing may be concluded by drawing up one document signed by the parties, as well as by exchanging documents through postal, telegraphic, teletype, telephone, electronic or other communications that make it possible to reliably establish that the document comes from a party to the agreement."
The key in this paragraph is the last phrase about reliably establishing that the document comes from the party to the contract. Therefore, it is advisable to indicate addresses in the contract Email(e-mail) of the parties.
It is also strongly recommended to conduct negotiations and correspondence regarding the conclusion of a contract with only one leading representative (manager) of the other party. Otherwise, references like “such and such a manager insisted on such and such a condition”, “you did not respond to our lawyer’s letter and thus agreed with him”, etc. inevitably arise, which makes it very difficult to reach agreements and conclude a contract.
Before concluding a foreign trade agreement, find out legal status, financial position and business reputation of the counterparty. Make sure that the lawyers drafting the contract have a good command of the language of your partner's country. Gain a clear understanding of the meaning of terms used in international business.
Nikolay Chudakov,
Director, Editor-in-Chief, legal reference system "System Lawyer"
In this article you will read:
- Important nuances of the conclusion foreign trade contract
- Errors in the foreign trade supply agreement
- Sample foreign trade agreement
Error 1. Concluded a foreign trade contract without checking the foreign counterparty
The legal status of a foreign person is confirmed by an extract from the trade register of the country of origin or another document issued in accordance with the legislation of the country of its location (clause 3 of the letter of the Presidium of the Supreme Arbitration Court of the Russian Federation dated December 25, 1996 No. 10).
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Consequences. If it turns out that the foreign counterparty is not registered as a legal entity or the agreement was signed on its behalf by an employee who does not have the authority to do so, then you should expect problems with the execution of the agreement. There is a high risk that the delivery of goods will not take place or will not be delivered on time. An unreliable supplier may not deliver the goods in in full or with shortcomings. But you will not be able to make a claim in connection with this (and return the prepayment). It will not be possible to find a foreign partner to serve on him, for example, a claim or lawsuit and summons to appear in an arbitration court.
How to do it right. You can assess the reliability of a foreign counterparty (in particular, check whether the company is really founded and registered in its country) by contacting, for example, chambers of commerce and industry or credit bureaus of the countries of the intended partners.
Most information about foreign companies, including financial ones, is not a commercial secret, so information about them can also be obtained from open sources - address (Jaeger Waldmann International Telex Teletex Directory, Teleurope, Marconis International Register, "Address-Europe") or proprietary reference books (Moodys Industrial Manual, Stock Exchange Official Yearbook), annual reports, prospectuses.
Error 2. Did not check the text of the contract in a foreign language
As a rule, a foreign trade contract is drawn up in two copies and in two languages. Therefore, there is a risk that discrepancies may arise between these texts due to incorrect translation or unclear understanding of the meaning of terms used in foreign trade.
Consequences. If there are discrepancies, the court will decide which text of the contract - in Russian or a foreign language - to apply. And it may turn out that it will be a text in a foreign language. Let me give you an example. A US company rented an office from a Russian landlord. The text of the agreement in Russian contained the wording “All disputes arising between the parties in relation to or in connection with this Agreement are subject to final resolution in the Arbitration Court of Moscow, Russia.”
However, the tenant filed a claim not with the Moscow Arbitration Court (which is part of the system of state courts), but with the International Commercial Arbitration Court at the Chamber of Commerce and Industry of the Russian Federation (ICAC) 1 . As a result, the ICAC decided that it was competent to consider this dispute, since “in the lease agreement in English, which, according to clause 19.2, has priority over the Russian text, in the arbitration clause we're talking about not about the Moscow Arbitration Court, but about arbitration in Moscow according to the rules of the ICAC, which is what is taking place in the present proceedings” (decision of the ICAC at the Chamber of Commerce and Industry of the Russian Federation dated December 9, 2004 No. 74 / 2004). ABOUT negative consequences for the incorrect name of the court in the contract, see section “Error 4”.
How right. Make sure that the lawyers who review the foreign trade supply agreement are fluent in foreign language, on which the contract was drawn up. In addition, it is advisable to include in the contract a condition that the text in Russian has priority (clause 7.5 in the sample foreign trade contract).
1 Arbitration courts (including the ICAC) are not part of the judicial system of the Russian Federation; they are alternative way protection of rights. The basic principle of arbitration proceedings is the voluntary compliance by the parties with the arbitration decision.
Mistake 3. Choosing an unfavorable applicable law or not agreeing on it
Applicable law is the law that is subject to application to the rights and obligations of the parties under the contract (clause 1 of Article 1210 of the Civil Code of the Russian Federation, hereinafter referred to as the Civil Code of the Russian Federation). The parties can choose it themselves. This may be the law of one of the parties to the contract or the law of a third state in which the supplier and buyer are not registered.
Consequences. If the dispute is considered under the national law of a foreign company, then the Russian side is at a disadvantage. After all, she does not know all the features of the law of another country as well as Russian law. As a result, when concluding a contract, and even more so when a dispute arises, the services of more qualified lawyers familiar with the law of the partner country will be required, and often the services of lawyers of the country whose national law is chosen as the governing law. As a result, signing the contract will cost a significantly larger amount.
If the agreement for the conclusion of a foreign trade contract does not indicate the applicable law at all, then the arbitration (regardless of which country it is located) will determine it in accordance with the conflict of laws rules that it considers applicable (Vienna Convention on International Contracts of 1980). purchase and sale of goods, Article 28 of the Law of the Russian Federation of July 7, 1993 No. 5338–1 “On International Commercial Arbitration”). Moreover, these can be norms of both international and national law. Often conflict of law rules different countries indicate that the law of the seller’s country is applicable to an international sales contract. This provision is also contained in Art. 1211 of the Civil Code of the Russian Federation. Thus, if the contract for the import of goods into Russia does not stipulate the applicable law, then, as a general rule, it will be the law of the seller’s country.
How to do it right. When developing and concluding a foreign trade contract, consider two circumstances. First, ask your lawyers to make such a contract much more detailed than regular contracts with Russian companies. Try to resolve all possible controversial situations in it and fix the rules for their resolution. After all, if a controversial situation arises that is not regulated by a foreign trade contract, then the law established in accordance with the conflict of laws rule will be applied, which the arbitrators will consider in in this case applicable. And much will depend on the laws of which country this dispute will be considered.
- Head of sales department: how to become an excellent manager
Secondly, even in the most detailed contract, you need to indicate the applicable law - in case some situation still remains unresolved (Figure, clause 5.3 of the contract). Try to invite the counterparty to choose Russian law. If he does not agree to this, then even before signing the contract, contact specialists who have experience in working with the law of the seller’s country so that they analyze the text of the contract for possible risks associated with the peculiarities of the legislation of that country.
Additional Information. Even if the parties have agreed that Russian law is applicable, the court will only apply it to those issues that are not regulated by the Vienna Convention on Contracts for the International Sale of Goods.
Mistake 4. Agreeing on an unfavorable arbitration clause
The contract must define not only the law that will be applied in the event of a dispute, but also the court that will hear the dispute (arbitration clause). The parties may appeal to the state court of the country of the seller or the country of the buyer, or to one of the international arbitration courts. Thus, you must first choose between state and arbitration courts, and then identify a specific court (either a specific arbitration court, or the country whose state court will hear the dispute).
Consequences. An irrational choice of court can lead to unnecessary costs. If the dispute is to be heard in a foreign court, then, firstly, you will need a lawyer who has the right to speak in such a court and is familiar with its procedure.
Secondly, conducting a process in many foreign countries requires more time and costs than considering a case in Russian state courts.
Finally, consideration of a case in an arbitration court has its own characteristics. The process can take several months, but the decision is final and is very rarely challenged in state courts (such a review can only be applied for on procedural grounds, but not if the losing party does not agree with the decision on the merits).
How right. Firstly, you need to correctly name the court you have chosen in the contract - it is important not to make mistakes in the terms. The fact is that in Russia, state courts that consider economic disputes in the business sphere are called arbitration courts (for example, the Moscow Arbitration Court). In other states and in international law, the term “arbitration court” usually means a non-state arbitration court (see section “Error 1”).
Secondly, if you have chosen one of the international arbitration courts, ask the lawyers to check its regulations and include in the text of the contract an arbitration clause exactly in the wording given in the regulations (Figure, clause 5.2 of the contract). This will eliminate the possibility that the case will end up being considered by a court that is not desirable for you.
Error 5. The basic terms of delivery were mixed up
Often the parties to a contract are not familiar with trade practices in different countries. To make it easier for them to develop contracts, the International Chamber of Commerce has compiled a list of the most typical options for their conditions - Incoterms supply bases. In the 2010 edition, there are 11 such options. Four of them are applicable only for sea and inland waterway transport, and the remaining seven are for all types of transport.
Consequences. Incoterms are applied by agreement of the parties. But if in the contract you refer to the corresponding Incoterms basis, then in the event of a dispute the court will apply it and will not take into account your assurances of ignorance of what this basis means.
How right. Carefully read (preferably with a lawyer) the description of all Incoterms terms and explanations to them. Calculate in advance which conditions will be more profitable for you as a buyer. If you have chosen, for example, the EX Works basis (ex-factory), directly indicate it in the contract, and also write the address of the place from where the buyer is obliged to pick up the goods (figure, clause 1.4).
If the parties change or supplement individual provisions of the selected terms of delivery (Incoterms), then all changed (added) conditions must be set out in detail in the contract. For example, you can specify what costs the parties bear in accordance with the selected delivery basis. Additionally, stipulate who bears the costs of loading and unloading, packaging and labeling of the goods. Clarify at what point ownership rights and the risk of accidental loss of the goods are transferred to the buyer. Then, not the Incoterms rule will be taken into account, but the special provision of the contract (ICAC decision of October 18, 1999 No. 385 / 1998).
Error 6. The edition of Incoterms was not specified
Consequences. If the contract does not indicate which edition of Incoterms you are using (or the name of the delivery basis and edition is incorrectly indicated), a controversial situation may arise.
Firstly, some of the bases were replaced. For example, in Incoterms 2000 there were bases DAF, DES, DEC, DDU. In Incoterms 2010 they are not present, instead DAT and DAP appeared. Therefore, if you write in the contract, for example, “Incoterms 2010 DAF,” then the court will have a question: what basis did the parties have in mind—whether the DAF basis from Incoterms 2000, or one of the new DAT or DAP bases in Incoterms 2010.
Secondly, when referring to a specific basis of Incoterms 2010, it is worth clarifying how it is formulated in this particular edition. The fact is that some delivery bases have changed slightly. In particular, one change was made to the FOB (free on board) basis. In the Incoterms 2000 edition, the seller's obligation to transfer the goods was considered fulfilled (and the risk of loss or damage to the goods passed to the buyer) at the moment of crossing the ship's rails, and in the 2010 edition - at the moment the goods were placed on board the ship.
How to do it right. In the contract, be sure to write down which edition of Incoterms you use. If you are referring to any of the old bases, indicate the edition in which it is used and the base itself, for example, “Incoterms 2000 DAF”. Then, in the event of a dispute, the 2000 edition will apply.
Additional Information. In the terms of the letter of credit, it is necessary to indicate what mandatory details the documents submitted to the bank must contain (name of the document; who issued or certified the document; main points in the contents of the document; language of the document - Russian, English, etc.); number of copies of originals and copies of such documents.
Error 7. The contract did not contain a complete list of documents
As a rule, sellers refuse to deliver without a guarantee, and the buyer refuses to pay for goods without actual delivery. Therefore today the majority Russian companies conclude foreign trade contracts with a form of payment such as a letter of credit. It excludes non-compliance with the conditions of both the supplier and the buyer.
With the letter of credit form of payment, the bank, at the direction of the buyer, undertakes to transfer money to the seller when he presents certain documents to him. The list of such documents is agreed upon by the buyer and seller in advance. Thus, a letter of credit allows the buyer to avoid the risks associated with making an advance payment: the money will be transferred to the seller only after the actual delivery of the goods; if delivery does not take place, the money will be returned within a predetermined time frame; the delivered goods will be of appropriate quality, in the agreed volume and assortment.
- Service agreement: sample, typical mistakes
Consequences. If the contract contains an incomplete or incorrect list of documents submitted to the bank, there is a risk that the seller will receive payment even if the goods have defects. For example, if the list of documents does not include a quality certificate, the bank will not be able to request such a certificate from the seller and will transfer payment to him based on the remaining documents. You, of course, will be able to make a claim to the seller if the product is defective, but it will take more time. In addition, you will have to demand that the seller return the funds already transferred to him.
How to do it right. A foreign trade contract must contain full list and an exact description of the documents that the seller must submit to the bank in order to receive payment. In particular, these are documents confirming the actual delivery of goods, their quality, quantity and range. Then, if the seller cannot confirm, for example, the proper quality of the goods, he will not receive payment from the bank.
Information about the author and company
Nikolay Chudakov specializes in tax and civil law. Graduated from the Faculty of Law of the State University Higher School of Economics. He worked as editor-in-chief of such professional publications as “Arbitration Practice”, “Tax Disputes: Theory and Practice”, “Documents and Comments”. Author of the books “Algorithms for winning a tax dispute: how to win against the inspectorate on procedural grounds” and “10 precedents on rental disputes.”
YSS "System Lawyer"- the first legal reference system of practical explanations from judges. Official website - www.1jur.ru
The concept of a foreign trade agreement. A foreign trade agreement (contract) is a type of business transaction, that is, an agreement of economic agents, one of which is not a resident of the Russian Federation or, being a resident of the Russian Federation, has a commercial organization abroad, aimed at establishing, changing or terminating civil rights and obligations in the implementation trade (export, import and re-export) operations.
A foreign trade agreement is characterized by the following features:
One of the counterparties to the transaction is a legal entity or individual of a foreign state (non-resident) or a resident of the Russian Federation who has a commercial organization abroad;
The goods are located on the territory of a foreign state;
When fulfilling a contract, the goods, as a rule, cross the customs border of one or more foreign countries.
Typically, an agreement contains an introductory part, details of the parties (legal address and bank details) and the following basic conditions:
Subject and object of delivery (name and quantity of goods);
Methods for determining the quality and quantity of goods;
Delivery time and place;
Basic delivery conditions;
Product price and total delivery cost;
Conditions of payment;
The procedure for delivery and acceptance of goods;
Conditions of transportation;
Conditions on guarantees and sanctions;
Settlement of disputes;
Circumstances of exemption from liability (force majeure).
The contract may also include provisions common to the obligations of the seller and the buyer:
The procedure for calculating losses and their compensation in the event of a possible violation of the obligations of one of the parties;
Sanctions for late payment;
Transport and currency risks;
Exemption procedures;
The right to suspend the fulfillment of obligations;
Product insurance;
Procedure for terminating the contract.
In the practice of international trade, standard forms and contracts are widely used, which are developed by large exporters and importers and their associations. The most common form of a standard contract consists of two parts - agreed and unified.
A foreign trade agreement in accordance with the Civil Code of the Russian Federation is concluded in simple written form. It should be borne in mind, however, that the 1980 Vienna Convention on Contracts for the International Sale of Sales does not require the contract to be in writing. It can be proven by any means, including testimony. The USSR ratified the Vienna Convention with the caveat that the Convention's requirement on the form of the transaction was unacceptable to it. Therefore, a foreign trade transaction carried out by a resident of the Russian Federation is subject to Russian legislation.
The process of concluding an agreement (including foreign trade) is regulated by the norms of the Civil Code of the Russian Federation (Articles 432-444). The legal instruments of this process are offer and acceptance. When concluding and executing a foreign trade agreement, it is necessary to comply with the general rules of law applicable to property turnover (Civil Code of the Russian Federation) and special rules of Russian legislation (customs, currency, tax, foreign trade, etc.).
Sources of legal regulation of foreign trade sales contracts. To relations arising on the basis of a foreign trade agreement, both Russian and foreign law. The partners choose legislation by agreement. If there is no such agreement in the contract, then conflict of laws rules apply.
A conflict of laws rule is a rule that determines which state’s law should be applied to the corresponding legal relationship. It has a referential character. It can be guided only in conjunction with a certain substantive legal norm to which it refers, that is, the norm of legislation that resolves the issue. essentially. It expresses a certain rule of behavior for participants in civil transactions, in our case - the seller and the buyer under a foreign trade sales contract.
According to the Constitution of Russia, generally recognized principles and norms of international law and international treaties of the Russian Federation are an integral part of it legal system. International treaties of the Russian Federation apply directly to relations regulated by civil law, except in cases where it follows from the international treaty that its application requires the publication of an internal act. If an international treaty to which the Russian Federation participates establishes rules other than those provided for by civil law, then the rules of the international treaty apply.
In the practice of international trade, the Vienna Convention of 1980 is most widely used. It determines the procedure for concluding a contract, its basic conditions, special trade terms in relation to the supply of goods and methods of determining prices, as well as the procedure for transferring ownership of goods. Its application is limited to sales contracts where the parties are located in the territory of different contracting states, or to cases where the law of a state party to the Convention is applicable to the contract.
If issues related to the subject of regulation are not directly resolved in the Convention, then they must be resolved in accordance with the general principles of the Convention; in the absence of the necessary principle - in accordance with the law applicable by virtue of the rules of private international law.
Certain types of sales are not covered by the 1980 Vienna Convention. For example, sale at auction, sale of securities, air and water transport, electricity. The Convention does not determine the procedure for settlements under a foreign trade sales contract and the limitation periods.
The provisions of the Convention are dispositive in nature, that is, it gives the parties to the contract the right, in the terms of the contract, to deviate from any of its provisions. If the purchase and sale agreement does not provide for such derogations, the rules of the Convention must apply to it.
The permanent arbitration body in Russia - the International Commercial Arbitration Court at the Chamber of Commerce and Industry of the Russian Federation - takes into account trade customs when resolving disputes. The Law of the Russian Federation on International Commercial Arbitration (1993) provides that the arbitral tribunal makes a decision taking into account the fact that this court resolves disputes on the basis of trade customs.
Trade custom (custom in trade) is a generally accepted rule that has developed in the field of foreign trade on the basis of constant and uniform repetition of these actual relations. Recognized as a source of law.
The application of customs accepted in international trade practice is carried out by the arbitration court in the following cases:
Such application is stipulated in the contract from which the dispute arose;
The rule of law that is subject to application to a controversial legal relationship refers to customs;
The application of custom is based on the provisions of an international treaty in force in relations between the states to which the parties to the dispute belong.
In commercial practice, commercial usage is also used, reflecting the established order or actually established in trade relations a rule that serves to determine the will of the parties not directly expressed in the contract. Trade customs are taken into account to the extent that the parties knew about their existence and had them in mind when concluding the contract. Most often, customs are used in the field of maritime transport. Customs are not a source of law; their application in actual relations depends on the will of the parties, not directly expressed in the contract.
The International Chamber of Commerce has published a collection of international rules for the interpretation of trade terms (last edition - 1990) - INCOTERMS (International Commercial Terms - INCOTERMS), the purpose of which is to clarify the most commonly used terms of delivery in foreign trade, thereby minimizing or eliminating differences in the interpretation of these terms in different countries.
INCOTERMS has gained recognition and wide application, since the interpretations of individual terms proposed in it correspond to the most common trade customs and rules that have developed in the international market. INCOTERMS interprets only the trade terms used in foreign trade sales contracts and does not apply to the terms of contracts of carriage.
The main purpose of interpretation is to clearly define the terms of the contract in relation to the seller’s obligations to deliver goods to the buyer and to unify the responsibilities of the parties to the contract. The range of basic conditions is very wide and covers all necessary and sufficient options - from the case where all responsibility lies with the buyer, to the case where all responsibility lies with the seller.
The interpretations proposed in the collection correspond to the most common trade customs and rules established in international practice. The rules are advisory in nature; their application in full or in some part in the contract depends on the will of the contracting parties. If there is a discrepancy in the interpretation of the basic terms in the contract and in INCOTERMS, the terms of the contract take precedence.
Having accepted the interpretation of the term according to INCOTERMS as the general basis of the contract, the parties can make changes or additions to it that correspond to the conditions accepted in the given branch of trade or the circumstances that arose when concluding the contract. The content of these changes must be specified in detail in the contract, since they can significantly affect the price level of the goods. The parties can supplement the contract with conditions reflecting the specifics of the transaction. Main principle, on which the INCOTERMS rules are based, is the minimum liability of the seller. If the buyer, for example, wants the seller to assume extended insurance obligations, appropriate additional terms must be included in the contract, since reference to INCOTERMS rules alone is not sufficient. Cases such as breaches of contracts and their consequences, as well as difficult cases to identify the owner of the goods remain outside the consideration of INCOTERMS.
The use of INCOTERMS helps resolve the problem of conflicts between national laws and their interpretations with the help of standard (standard) trade terms and definitions, which are proposed as “neutral” rules.
Basic terms of delivery. The basic terms of delivery determine the obligations of the parties to the purchase and sale agreement related to the delivery of goods from the seller to the buyer, and establish the moment of transfer of ownership of the goods and the risk of accidental loss or damage to the goods from the seller to the buyer. The basis conditions create the basis (basis) of the price depending on whether delivery costs are included in the price of the product or not.
In the edition of INCOTERMS 1990, the terms defining the basic conditions are divided into four groups
1. The situation when the seller transfers the goods to the buyer directly on his premises (terms of group “E” - shipping - EXW - ex-factory).
2. The situation when the seller undertakes to deliver the goods to the carrier chosen by the buyer (terms of group “F” - the main type of transportation is not paid by the seller - FCA, FAS, FOB).
3. A situation where the seller undertakes to enter into a transportation contract, but without taking on the risk of accidental = loss or damage to the goods or any additional costs after loading the goods, the seller is responsible for the transportation of the goods, but not for its loss, damage, and does not bear additional expenses incurred after sending the goods (term group “C” - the main type of transportation is not paid by the seller - CFR, CIF, CPT, CIP).
4. Terms defining the conditions for the passage of cargo until its delivery to the country of destination. The seller bears all costs and assumes all risks until the goods are delivered to the destination country (group “D” - arrival of cargo - DAF, DES, DEQ, DDU, DDP).
The INCOTERMS for each term indicate the respective responsibilities of the seller and the buyer. However, the diversity of spheres and regions of trade does not allow universal rules to formulate in detail the obligations of the parties under all possible sales contracts. Therefore, when preparing a draft contract, it is necessary to study the practice that has developed in certain areas (trade, samples of existing contracts. It is advisable that the seller and buyer, during the period of concluding the contract, inform each other about such practice and, in order to avoid ambiguities, clearly reflect their positions with the relevant terms of the contract.
INCOTERMS rules apply only between the parties to the purchase and sale agreement and do not apply to relations arising from the contract of carriage. Answers to the questions of how the seller must fulfill his obligations to ship the goods to the carrier for their transportation and what is the legal fate of the cargo in transit should be sought in international transport legislation or in an international transportation contract.
The term “carrier” means not only an enterprise directly carrying out transportation, but also an enterprise that undertakes to act as a carrier or intermediary in the transportation and deliver the goods to the point specified by the buyer (legal or individual responsible under the contract for transportation ).
Let's consider the content and interpretation of the bases.
1. Condition “E” - ex-factory (EXW). This condition is beneficial to the seller, since it imposes a minimum of obligations on him - the only obligation of the seller is to make the goods at his enterprise (in warehouses, warehouses, terminals) at the disposal of the buyer. In this case, the seller is not “responsible for loading the goods onto the vehicle provided by the buyer. All risks associated with the transportation of goods from the seller to the destination are borne by the buyer. This basis sets out the following obligations of the parties.
The seller is obliged:
1. Deliver the goods in accordance with the terms of the contract, providing for their quality and condition.
2. Place the goods at the buyer’s disposal within the time period specified in the contract at the designated delivery point for loading onto the buyer’s means of transport, having notified him of this in advance.
In practice, the question arises about the moment when the goods become the property of the buyer. This is the provision of goods at the disposal of the buyer, which means the creation by the seller of the organizational and legal conditions and opportunities required for the buyer to inspect the goods, check their quality and quantity and take possession of them. Therefore, if the buyer, having paid for the freight of the transport, delivers the wagon for loading on the specified date, but it turns out that due to the fault of the seller the goods cannot be picked up, losses, including transportation costs and payment of the railway transport tariff, will be borne by the seller.
3. Provide, at your own expense, the packaging necessary to enable the buyer to accept the performance. This basis assumes that the seller uses the minimum packaging of his goods that ensures loading of the goods.
The legal literature provides a typical trial in an arbitration court of a dispute between the parties related to the application of the ex-works basis.
One of the Ural enterprises entered into an agreement for the supply of chemical products (urea) to the People's Republic of China on "Franco-Combine" terms. When accepting the goods, the Chinese side demanded that the urea be not only loaded onto railway platforms for the agreed price, but also packed in plastic bags. The Russian supplier reasonably did not agree with this requirement, pointing out that the chosen delivery basis required minimal packaging. To weigh and conduct a chemical analysis of urea, that is, to place the goods at the disposal of the importer-buyer, it is sufficient only to load it onto the rolling stock. If the buyer requires additional packaging to ensure better safety of the cargo in transit, the seller agrees to do this for an additional payment for unloading the goods, its packaging and new loading, as well as the cost of plastic containers. The arbitration court agreed with this position and rejected the Chinese side's claim.
4. Pay the costs incurred by checking the goods (quality checks, measurements, weighing, counting, etc.), which is necessary to make the goods available to the buyer.
5. Bear all risks to which the goods may be exposed and all costs associated with the delivery of the goods until they are placed at the disposal of the buyer.
The buyer is obliged:
1. Accept the delivered goods as soon as they are made available to the buyer at the place and time specified in the contract; pay the price of the goods in accordance with the terms of the contract.
2. Bear all costs incurred by the goods and all risks to which they may be exposed from the moment the goods are placed at the disposal of the buyer.
3. Pay customs duties and export taxes.
2. Conditions "F":
Free carrier (FCA - free carrier);
Free along the side (FAS - free alongside ship);
Free on board (FOB - free on board).
Under these conditions, the seller must transfer the goods to the carrier in accordance with the instructions of the buyer, who in turn selects the carrier and enters into a contract of carriage.
Free carrier condition (when transporting goods by railway- free wagon) means that the seller is considered to have fulfilled his obligations to deliver the goods after handing them over to the carrier. The seller's responsibilities are to place the goods, cleared for import, into the custody (protection) of the carrier or a person acting on his behalf. Free carrier conditions apply to the delivery of goods not only by land, but also by water and air. Provided the free carrier, the risk of accidental loss or damage to the goods passes from the seller to the buyer at the moment the goods are transferred to the carrier. As a rule, the place of transfer of goods to the carrier is determined by the buyer, which must be specifically stipulated in the text of the foreign trade purchase and sale agreement. If such a condition is not in the contract, the seller chooses the place where the goods are transferred to the carrier.
Customs clearance is a set of procedures for customs clearance of imported goods, providing for the payment of duties, taxes and fees when importing goods into the country.
Under FAS (free along side) condition, the seller is considered to have fulfilled his obligations when the goods are placed along the side of the ship on the quay (pier) or on the lighter (if the ship is anchored). Ownership of the goods passes from the seller to the buyer after the goods are placed on the pier along the side of the ship. The risk of accidental loss or damage to the goods and all subsequent costs are transferred to the buyer from the moment the ownership of the goods is transferred to him. As with ex-factory conditions, the buyer carries out customs clearance of the goods.
Under the FOB (free on board) condition, the seller is obliged, at his own expense, to deliver the goods on board the ship chartered by the buyer at the agreed port of loading within the specified time, and, unlike the FAS condition, to clear the goods from export duties. The buyer must charter the vessel at his own expense and promptly notify the seller of the term, conditions and place of loading, name, and time of arrival of the vessel. In this case, ownership and the risk of accidental loss or damage to the goods, as well as all further costs, pass from the seller to the buyer at the moment the goods are transferred on board through the rail of the given vessel.
3. Conditions “C”:
Cost and freight (CFR - cost and freight);
Cost, insurance and freight (CIF - cost, insurance, freight);
Freight/carrying charges, insurance paid up to... (CIP - cost, insurance paid for...);
Freight/transportation fees paid to... (CPT - cost paid to...).
Under conditions “C”, the seller must conclude a contract of carriage on normal terms at his own expense up to the point specified in the sales contract. Under the terms “cost, insurance and freight” and “freight, insurance paid before...” the seller is also obliged to arrange and pay for insurance of the cargo (goods).
Freight - payment to the owner Vehicle(mainly sea) for the services provided to them for the transportation of goods, as well as, depending on the terms of the contract, fees for loading, unloading and stowing goods.
The essence of conditions “C” is that the seller is released from any further risk of accidental loss or damage to the goods and expenses after he has properly fulfilled his obligations: concluded a contract of carriage, transferred the goods to the carrier and provided insurance under the terms “cost, insurance and freight” and “freight, insurance paid until...” (shipment agreement).
The delivery terms CFR (cost and freight) are similar to FOB terms. The risk of accidental loss or damage to the goods, as well as the risk of any increase in costs, passes from the seller to the buyer when the goods are transferred over the ship's rail at the port of shipment. The difference is that under CFR, the seller assumes the responsibility to pay the costs and freight necessary to deliver the goods to the specified destination.
The CIF (cost, insurance and freight) delivery condition imposes on the seller, in addition to the obligations under the CFR condition, also the obligation to provide insurance against the risk of accidental loss or damage to the goods during transportation. The seller is obliged to charter the tonnage and pay the freight, deliver the goods to the port and load them on board the vessel within the agreed period, hand over the bill of lading to the buyer, as well as enter into an agreement with the insurer, pay the insurance premium, issue an insurance policy to the buyer and hand over to him.
Bill of lading is a document issued by the carrier to the cargo owner to certify the fact of acceptance of cargo for sea transportation and confirmation of the obligation to transfer it to the consignee at the port of destination. Performs three functions: receipts for the receipt of cargo by the ship; shipping document in international trade; evidence of the existence and content of the contract of carriage.
Delivery terms FAS, FOB, CFR, CIF are used only for transportation by water.
4. Conditions "D":
Delivery free-border (DAF - delivered at frontier);
Delivery ex-ship (DES - delivered at ship);
Delivery ex-berth (DEQ - delivered et quay);
Delivery without payment of customs duties (DDU - delivered duty unpaid);
Delivery with payment of customs duties (DDP - delivered duty paid).
Under conditions “D”, the seller is responsible for the arrival of the goods at the agreed point or port of destination and bears all risks and all delivery costs (arrival agreement). These conditions fall into two categories:
Under the conditions of “delivery free-to-border”, “delivery free-ship” and “delivery without payment of customs duties”, the seller is not obliged to deliver the goods with customs clearance for import;
Under the conditions of “delivery free berth” and “delivery with payment of customs duties,” the seller is obliged to deliver the goods and clear the goods through customs.
The choice of one or another basic delivery condition is determined by the parties to the contract, who must keep in mind that this choice predetermines the content of many subsequent terms of the contract. In this case, both the seller and the buyer proceed from the principle of the lowest material costs for delivery. For example, the costs incurred by the seller, under the condition of the buyer's ex-warehouse, are included in the price of the goods, which can be paid in foreign currency. If the buyer has a shortage of foreign currency, then ex-factory conditions are more favorable for him. In this case, the buyer can avoid additional costs in foreign currency by arranging, for example, delivery of the goods using his own transport or under an agreement with a carrier that does not require payment in foreign currency.
Formation of the terms of a foreign trade agreement. The formation of the terms of a foreign trade transaction can be carried out in two ways, depending on the legal system used:
1. If contractual obligations are regulated by Russian legislation or the legislation of a foreign partner, the parties have the right to formulate the terms of the agreement either in accordance with the civil legislation of Russia (including the Vienna Convention as an element of the legal system) or in accordance with the law of the foreign partner.
2. If private international law is chosen as the applicable law, the content of the contract may be formed under the influence of international unified rules for the interpretation of commercial terms (INCOTERMS delivery bases).
The conflict of laws rule of private international law establishes that the law governing a foreign trade transaction is determined by the place where the contract is concluded. Therefore, the contract must indicate the place of its signing.
If the parties to the contract have not specified the terms of the law that will guide them when considering disputes, then it is the place where the contract is concluded (it is signed) that will indicate the applicable law. For Russian entrepreneurs, it is advisable to indicate in the contract the place of its signing - the Russian Federation, although negotiations can be conducted in any other country.
When using INCOTERMS delivery bases, the following must be taken into account:
1. INCOTERMS become part of a foreign trade contract only when the parties directly or indirectly refer to them. If the trade law of Austria, France or Germany is chosen as the applicable law, the terms of INCOTERMS under the laws of these states apply even if this is not specifically provided for in the contract. Therefore, when concluding a deal with partners from these countries and not wanting to be guided by INCOTERMS, you should specifically stipulate this circumstance.
2. The parties, having accepted INCOTERMS as the general basis of the contract, can make additions to the contract that correspond to the conditions accepted in this branch of trade, or their personal desires, or special circumstances that arose when concluding the contract. Any provision contained in INCOTERMS cannot be applied or relied upon by the interested party if the matter was otherwise dealt with at the conclusion of the contract.
3. INCOTERMS bases do not apply to the terms of the contract of carriage. These customs apply only in the relationship between the parties to this agreement - the seller and the buyer and have neither direct nor indirect meaning for the carrier.
When concluding a foreign trade sales contract, it is necessary to reach an agreement on all significant issues. These include:
Subject of the agreement;
Product quality;
Product price and total contract amount;
Delivery time;
Payment method;
A foreign trade contract is an agreement in writing or on magnetic media that fixes commercial relations between parties that are economic entities ( individuals, firms) subjects of different countries. The contract establishes certain rights and obligations of partners (contractual terms, procedure for their execution, responsibility). A contract for foreign trade purchase and sale transactions usually contains several sections:
Information about the parties who entered into the contract (exact names and details of the parties);
Subject of the agreement;
Price and total amount;
Delivery times, terms of payment, seller guarantees;
Packaging and labeling;
Penalties;
Insurance;
Agreed definition of force majeure circumstances (force majeure), arbitration.
Taking into account the characteristics of the products that form the subject of the contract, sections on the following may be additionally introduced:
Conventional fines;
Technical documentation;
Inspection and testing;
Export licenses;
Force majeure circumstances;
Special and other conditions.
An indispensable condition of a purchase and sale transaction formalized by a foreign trade contract is the transfer of ownership of the goods from the seller to the buyer. This fundamentally distinguishes such contracts from other types of contracts in the field of foreign economic activity.
A purchase and sale contract in foreign trade, as well as within the country, under the conditions of contractual relations between market entities, performs the following three main functions:
Legally consolidates the relationship between the parties, giving them the nature of obligations, the fulfillment of which is protected by law;
Determines the order, sequence and methods of performing partners’ actions;
Provides measures to ensure the fulfillment of obligations by the parties.
The parties to the contract must determine which state’s law will be applied when choosing the form of concluding a transaction, regulating the rights and obligations of partners, as well as when resolving controversial issues if they arise. Practice has developed certain order carrying out foreign trade purchase and sale transactions: preparation, coordination, conclusion and execution of the contract.
Subject of contract. This section contains the name of the goods that are the subject of the transaction, usually indicating the quantity to be delivered, and brief description(standard, GOST, technical specifications). The name must be accurate and complete, for example, when supplying equipment: type, brand and a number of other data. Often the name of the goods and their data and list are indicated in the specification application. For example, equipment: quantity, assortment, price, who makes the payment, technical conditions, delivery date, method of transportation, procedure for obtaining a safety certificate for the product if necessary, type of packaging and the need for labels and operating instructions with the product, technical passports, the required set of spare parts.
The specification is also signed by the parties and stamped - an integral part of the contract.
Quality. When preparing this article of the contract, the parties are guided by the following criteria: specification, sample, description (catalogues), output of finished products, TelQuel (as it is) (Amsterdam).
The quality of the product is confirmed by a certificate from the country of origin, and the safety of the product for the end consumer is confirmed by a safety certificate obtained in accordance with the current legislation of the Russian Federation under the conditions stipulated in the specifications to the contract. When importing goods, their quality must be confirmed by a quality certificate issued by the state commercial organization of the country - the manufacturer of the goods.
The quality of the supplied goods must comply with the standards established in the Russian Federation. For the importer, a catalog is attached to the contract. The equipment must comply with the reference samples agreed upon by both parties, as well as the technical conditions set out in the specifications established for this contract. Technical conditions are established for complex equipment.
Basic terms of delivery. IICOTERMS-2000. When concluding a contract, they use unified international rules for a uniform understanding of the most commonly used delivery terms for foreign trade INCOTERMS-2000 (Table 2.1), which includes four groups:
1. Group E (departure) - EXW (Ex-works).
2. Group D. The seller provides the goods to the carrier chosen by the buyer. The main type of transportation is not paid for (FCA, FAS, FOB).
3. Group C. The seller undertakes to enter into a contract of carriage without assuming the risk of damage and other additional costs. The main type of transportation is paid by the seller (CFR, CIF, CPR, CIP).
4. Group I (arrival). Determines the terms of delivery of cargo up to the country of destination. All costs are borne by the seller (DAF, DES, DEC, DDU, DDP).
Structure of INCOTERMS-2000
| Trading group | Designation | Summary conditions |
| terms, | ||
| Group E | EXW | Ex-factory |
| Departure | (name of place) | |
| Group R | FSA | Franco carrier |
| Main | (name of destination) | |
| shipping | F.A.S. | Franco along the side of the vessel |
| not paid | (name of port of shipment) | |
| ROV | free on board | |
| (name of port of shipment.) | ||
| Group C | CFR | Cost and freight |
| Main | (name of destination port) | |
| Persian German | CIF | Insurance cost and freight |
| paid | (name of destination port) | |
| SRT | Freight/carriage paid up to | |
| (name of destination) | ||
| CIF | Freight transportation and insurance | |
| paid to (place name | ||
| destination) | ||
| Group B | DAF | Delivery to the border |
| Arrival | (name of place of delivery) | |
| DES | Delivery ex ship | |
| (name of destination port) | ||
| DEQ | Delivery from the pier | |
| (name of destination port) | ||
| DDU | Delivery without payment of duty | |
| (name of destination) | ||
| DDP | Delivered Duty Paid | |
| ("destination name) |
Price per item and total amount. Payment of the price is the buyer's primary obligation under the contract. Usually the price per unit of goods is indicated, as well as the total amount of the contract in figures and words.
The price of a product at which the product is sold on the foreign market is the foreign trade price.
Flails are classified according to the degree of certainty and the method of fixation.
According to the degree of certainty, the following prices are distinguished:
●definite - direct establishment of a chain in the form of a fixed amount;
●definable - an indirect reference to the conditions for calculating the price at the time of payment. In this case, the contract specifies reference prices published in periodicals, stock quotes, etc. According to the method of fixing prices, they are divided into:
● for firm ones - are established at the time of signing the contract, are not subject to change during the entire period of its validity and do not depend on the timing and order of delivery of the goods. In contracts with long delivery periods, the clause “the price is fixed and cannot be changed” is made;
●periodically firm - defined as a fixed amount valid for a specific period of time. At the moment of signing the contract, prices are not fixed, but determined (for example, before delivery or at the beginning of the year);
●movable - fixed when concluding a contract; such prices may be revised if the decisive price changes by the time the goods are delivered. When establishing a moving price, a price clause is included in the contract, stipulating that if by the time the transaction is executed the market price increases or decreases, the price fixed in the contract must change accordingly. Movable flails, unlike periodically solid ones, are fixed in the contract, but require revision of prices by the parties when they change in the market by a certain percentage (usually more than 3%);
●sliding - calculated at the time of contract execution by revising the contractual base price taking into account changes in production costs occurring during the period of contract execution. Used in contracts for durable goods.
The contract value is adjusted when pricing factors (wages, cost of raw materials, etc.) change during the contract period. At the same time, the limits of deviation of the actual price from the contract price in one direction or another are specified.
A wide range of sources are used for chain analysis. At the stage of preliminary determination of the level of contract prices for goods, they are guided by published settlement prices. Publications include: reference prices, stock quotes, auction prices, prices of actual transactions, bid prices of large firms. These prices reflect the level of world prices.
The starting point in price negotiations is reference prices, which are based on prices published in various directories and price lists. The basic price of goods is regularly revised taking into account changes in the range of foreign trade exchanges on the market.
Base price is accepted as a basis when determining the foreign trade price of a product. It depends on the basic conditions specified in the contract for its delivery to the destination in accordance with INCOTERMS 2000 (for example, CIF - the price includes the costs of labeling, packaging, insurance, loading, transportation of goods).
Packaging and labeling of goods. The type of packaging is determined in the contract basic conditions. Thus, under delivery conditions that involve transportation of goods by sea, the seller is obliged to provide sea packaging of the cargo and other services for land transportation.
If the contract does not specify packaging, the seller must ship the goods in packaging used for export of goods in the seller's country, which would ensure the safety of the goods during transportation, taking into account possible overloads, with proper and normal handling of the goods. In this case, the duration and methods of transportation must be taken into account. Before packaging, equipment and machinery must be lubricated to protect against corrosion.
The nature and seriousness of the violation of the above requirements for product packaging determine the eligibility of the buyer to terminate the contract.
Packaging should serve as a source (carrier) of information, advertising and labeling, provide convenience during operation and storage of the product, i.e. Automation methods and means must be taken into account.
The external packaging of the goods is specified in the contract (containers, boxes, etc.). Inner packaging is inseparable from the product. The quality of packaging is determined by reference to technical standards and specifications.
Methods of payment for packaging are established by the parties to the contract and may provide for the inclusion of the price of packaging in the cost of the goods. Also, the price of packaging can be determined as a percentage of the cost of the product or separately. Each package must include a detailed packing list.
Labeling serves three purposes:
1) identifies the cargo for carriers and other persons involved in transportation and dealing with it during transportation and transit;
2) indicates to the consignee the appropriate procedure and activities to ensure correct delivery of the cargo. The marking must be applied with indelible paint and allow the cargo of one buyer to be distinguished;
3) warns of the dangers that the cargo may pose if it is handled improperly.
Labeling must include general information about the cargo, namely: name of the product; name of the sender, supplier; the purchasing company; destination; point of departure; general information about the cargo; contract number; died places; instructions for loading and unloading.
There are a number of international agreements on labeling and packaging, such as International Agreements I: on the Transport of Dangerous Goods.
Non-compliance of packaging, protection and labeling with the terms of the contract may be an independent type of violation of contractual obligations that causes damage. As a result, packaging/labeling are most often separate obligations for which special sanctions may be provided.
Delivery and acceptance of goods based on quality and quantity. The content of the terms of a foreign trade sales contract on the delivery and acceptance of goods in terms of quantity and quality depends on the basic terms of delivery and the nature of the goods. In this case, the general rule applies (unless otherwise specified in the contract) that the delivered goods must be delivered and accepted in quantity and quality at the moment and place when and where the transfer of ownership of the goods and the risks of accidental loss of the goods or damage to them occur from seller to buyer.
Delivery/transfer of goods by the seller into the possession of the buyer is carried out in accordance with the terms of the sales contract. As a result, full control over the goods passes to the buyer (delivery of documents of title is considered as the transfer of the goods themselves).
Transfer/delivery of goods is carried out at the expense of the seller. The cost of delivery of goods includes the cost of weighing, counting, labeling, packaging, possible customs and other fees.
In the process of acceptance of goods, the recipient must check the conformity of the quality, quantity and completeness of the goods with its characteristics and technical conditions specified in the contract.
Delivery and acceptance is one act. It is reflected in the contract as follows: “The goods are considered delivered by the seller and accepted by the buyer...” The contract includes conditions on the procedure for delivery and acceptance: type, date and place of actual delivery and acceptance, methods of verification and methods for determining the quantity and quality of the goods actually delivered , as well as the person carrying out the delivery and acceptance.
There are preliminary and final acceptance.
During preliminary acceptance, the goods are subject to inspection at the seller’s enterprise in order to determine the quantity, quality, correct packaging and labeling of the goods, and compliance with its technical specifications. As a result of preliminary acceptance, the buyer can reject the goods if defects are detected or demand that the defects be eliminated within a certain period.
During the final delivery and acceptance, the actual completion of the delivery in the prescribed place and on time is recorded. Based on the results of final acceptance, calculations are carried out for a foreign trade transaction.
The place of delivery and acceptance is specified in the contract precisely: a warehouse, port, enterprise, etc. The delivery and acceptance period is the period of time during which the buyer is obliged to check the quantity of the goods immediately upon receipt, and the quality is checked over a longer period.
Delivery and acceptance can be carried out according to quantity and quality.
Upon acceptance by quantity, the compliance of the actually delivered goods with the terms of the contract is checked. The buyer is not obliged to accept the goods in more or less quantity than provided for in the contract in the absence of the “about” clause. The buyer may refuse to pay for excess goods by paying for the quantity stipulated in the contract.
When selling cash goods and in transactions with the subsequent delivery of goods that have generic characteristics, trade customs provide for the seller’s right to deliver goods in greater or lesser quantities compared to the contractual quantity (“about”). The magnitude of deviations varies depending on the type of product. For example, the grain trade provides for a 10% deviation for Cargo contracts (entire ships) or 5% for Parcel contracts (in batches on one or more ships). In trade, in particular, with natural rubber, the deviation is 2%, timber - 10%, cocoa beans - 3%.
Acceptance of goods for quality is carried out in two ways:
1) on the basis of a document confirming the compliance of the quality of the goods with the terms of the contract;
2) by checking the quality of the actually delivered goods at the place of acceptance (inspection of the goods, comparing them with samples, conducting analysis).
Nine methods are used to determine quality.
1. Preliminary inspection “inspected and approved”. It is used in the trade of goods with individual characteristics from a warehouse. The buyer is given the right to thoroughly inspect the entire shipment of goods within the prescribed period. He may not use it, which means his consent to accept this batch of goods according to the contract. The transaction is canceled if the inspection is unsatisfactory.
2. According to the standard. In this case, the characteristics of the physical, chemical, technological and other properties of the product, its packaging, labeling, etc., determined by the relevant organizations, are checked. If there is a standard that precisely defines the properties of the product, it is much easier to establish the quality of the product in the contract.
In international trade, the most common standards are those developed by various associations (international organizations, national standards and technical specifications). The standards developed by the International Organization for Standardization ISO-9000 for product quality management are used by all European countries as national standards. In 1987, it was decided to apply ISO-9000 standards to industrial enterprises in Russia.
3. Checking technical conditions. This method is prescribed in the contract and is used in the absence of standards and the supply of single products. The terms are agreed upon by the parties and are an integral part of the contract.
4. Sale of branded goods, i.e. under a famous brand. This method can be classified as a group of standard-based transactions.
5. Sample check. This method is common in the trade of goods that have generic characteristics, but are not unified enough to become the subject of sale according to the standard.
The seller selects two or more identical samples of the product. One is handed over to the buyer and sealed with the seller's seal. The second remains with the seller, and the third, if specified in the contract, is deposited with the Chamber of Commerce or other independent organization. During the buyer's acceptance of the goods, the incoming batch of goods is identified with a sample stored by the buyer or a third-party independent organization. If a discrepancy is found between the goods and the sample, the buyer has the right not to accept the shipment and demand from the seller a replacement of the goods, a refund if paid, and compensation for losses. When resolving disputes in arbitration court, the third of the samples is usually used.
6. Method on conditions Te10, ie1 The use of this method indicates the absence of requirements for the quality of the product, as long as the product corresponds to its name. All possible consequences of deterioration in the quality of the goods during transit fall on the buyer.
7. Method for yielding the finished product. Used in trading certain types of raw materials. Quality is determined through the volume of the finished product that can be made from a unit of a given raw material. For example, from a certain amount of raw sugar you can obtain a certain amount of refined sugar using a clearly defined technological process.
9. According to accepted quality. The quality must correspond to the average quality accepted in trade. The product is designated as “regular” or “medium”. The most common term is “good average quality”. For some commodities, existing trade customs establish precise indicators for determining the average or good quality. For example, in the cocoa bean trade, the term “satisfactorily fermented” means the presence of 10% unfermented beans and 10% damaged beans, “well fermented” - up to 5% of both.
The contract stipulates who carries out the delivery and acceptance of the goods: the parties or their representatives jointly, competent organizations appointed by agreement of the parties.
Delivery time. These are calendar dates by which goods must be delivered by the seller or contractors to specified geographic locations. Items are usually determined by the basic terms of delivery.
The contract can specify the date in two ways:
1) exactly - a specific day, week, month, quarter;
2) indirectly - “within 30 days from the date of signing the contract”, “from the date of receipt of technical documentation”, “from the date of opening of the letter of credit”, etc. Most often - “from the date of border crossing”.
Documents confirming the fact of delivery are a railway waybill, an air waybill, a bill of lading, a postal receipt, acts of acceptance and transfer of goods, warehouse receipts, etc.
Shipping times may be specified as follows:
● “immediately” - the period required to complete customs formalities and transportation (the seller’s obligation to deliver the goods within no more than two weeks on any day);
● “as quickly as possible” - the seller is obliged to take all measures to deliver the goods within the shortest possible time;
● “as ready”;
● “on opening navigation”;
● “according to the accumulation of a batch of at least... tons”; etc.
In foreign trade, the seller’s right to early delivery of goods (buyer’s permission) is usually stipulated. If the delivery is one-time, then a period is established during which it will be carried out, or a specific date before which the goods must be delivered. If goods are supplied in batches and over long periods of time, the parties draw up schedules specifying the goods, quantities and periods. If delivery is made before the delivery date in the contract, the buyer has the right to refuse the goods. Everything is stipulated in the contract as follows: “Early delivery is permitted.”
The delivery date of the goods is:
● date of receipt of the goods at the buyer’s warehouse (when transported by road), at the airport, at the station (railway transport);
●date of the invoice issued in the name of the buyer (CIF or CIP). A condition in the contract for the maintenance of a consignment note issued in the name of the buyer is allowed;
●date of the invoice issued in the name of the buyer. The consignment note must contain: the cost of the cargo; date of dispatch, contract number, address of regional customs, buyer’s address, telephone numbers, etc.
For violation of delivery deadlines, the parties provide for conditions of liability, usually a fine. This is also stated in the contract.
Notice of shipment (transport conditions). This article of the contract is necessary if the process of delivering goods involves a significant amount of transport work: large quantities, deliveries by sea or other waterway; coordination of the vessel delivery schedule and their technical parameters; reloading, transshipment of goods at the port. In this case, a separate article “Transport conditions” is highlighted in the contract. If the volume of work is not so significant, then the article “Notice of shipment” is included as a paragraph in the article “Transport conditions”.
Conditions of payment. This section provides for determining the procedure for payment for the delivered goods (form, currency, payment terms). Documentary and non-documentary terms of payment may be provided here.
Documentary conditions provide for payment - transfer to the exporter of the amounts due to him against the provision by the seller to the buyer through the bank of a set of shipping documents confirming the fact of the shipment of the goods.
TO documentary operations include documentary letter of credit and documentary collection - about 80% of all foreign trade payments. Of these transactions, a documentary letter of credit accounts for 70%, since it is more reliable than collection, i.e. the obligation of the bank that opened the letter of credit (importing bank) to pay the amount due to the exporter after providing him with a set of shipping documents drawn up in accordance with the conditions of opening the letter of credit. In case of collection, the importing bank is only the executor who uses the funds in the client’s account, therefore a letter of credit is more expensive than collection.
Undocumented terms of payment do not provide for linking the payment and the transfer of a set of shipping documents.
Duties of the parties. The seller's responsibilities include delivering the goods to the buyer at the specified time and place, ensuring the quality of the goods, their packaging and labeling. The buyer is responsible for accepting the goods and paying for them according to the terms of the contract. A specific list of rights and obligations of the parties is formulated in the basic terms of delivery INCOTERMS-2000.
A foreign trade sales contract depends on the basic terms of delivery.
At the buyer's request, the seller is obliged, at his expense, to provide full assistance in obtaining documents issued in the supplier's country.
Guarantee of quality and completeness of delivery. This condition is usually present in foreign trade contracts and determines the scope of the warranty provided by the seller, the warranty period, and the seller’s responsibilities in case of detection of defects. The scope of the warranty provided depends on the nature of the goods and the technical conditions of the contract.
The following warranty periods of operation and shelf life are distinguished.
Warranty period is the period of time during which the manufacturer guarantees the stability of the quality indicators of the product during the process. its operation, subject to the consumer's compliance with the operating rules.
Guaranteed shelf life is the period of time during which the manufacturer guarantees the safety of all performance indicators and consumer properties of the product established by the standards, provided that the consumer follows the storage rules.
Guaranteed shelf life is the period of time during which the manufacturer guarantees all indicators and consumption properties of the product established by operating standards, provided that the consumer complies with the rules of operation and storage.
After the expiration date, the product loses its consumer properties and cannot be used for its intended purpose.
The warranty period can range from several months to several years.
The warranty period can be calculated from the moment:
● delivery of goods;
●transfer of goods;
●transfer of goods to the first consumer;
●the buyer receives written notification from the seller that the equipment is ready for shipment;
●putting equipment into operation.
In relation to quality guarantees, a distinction is made between product completeness and delivery completeness.
The completeness of the product presupposes the need for its delivery in such a set of components that will allow the product to be used for its intended purpose. This set usually includes components, assemblies, parts, i.e. finished product.
Completeness of delivery means that the seller has accepted the obligation to deliver the goods in the totality of its component parts provided for in the contract. Such a delivery may include a smoked product in a certain volume, both associated and not associated with a single economic purpose.
Liability for breach of contract. Sanctions. A breach of contract is a failure to fulfill obligations or their improper fulfillment. The party that improperly fulfilled its obligations or did not fulfill them at all shall compensate the injured party for the damage caused by paying a certain fine or penalty.
Fines can be expressed either as a flat amount or as a percentage of the total value of the undelivered goods. The article of the contract “Price of the goods” determines the method of calculating the fine and its payment. A fixed fine is provided for in cases where the counterparties have agreed on a firm price for the goods delivered. If a sliding price is specified, then it is beneficial for the buyer to calculate the fine as a percentage of the cost of the undelivered goods, since as the price of the goods increases, the amount of the fine collected increases.
Grounds for exemption from liability. Force Majeure. After the conclusion (execution) of a contract, certain emergency situations may arise that prevent its proper execution. A party is not liable if it proves that the failure to perform the contract was caused by obstacles beyond its control.
The circumstances of the impossibility of fulfilling obligations under the contract must be of a nature that arose “against the will” and “without the fault of the parties to the contract.”
In a contract, circumstances of force majeure are called “force majeure”. They allow you to postpone the execution of the contract or generally release the parties from full or partial fulfillment of obligations.
TO general principles Definitions of “force majeure” include:
^ the objective and absolute nature of the circumstances, when the circumstances apply to everyone and the impossibility of fulfilling obligations is absolute and not difficult for the debtor;
^ legal force majeure, which is a decision of the highest government bodies (imposition of import bans, currency restrictions, etc.).
Circumstances of ordinary commercial risk are not recognized as force majeure: unfavorable market conditions, bankruptcy.
A clear definition of force majeure must be given.
By force majeure, the parties mean external and extraordinary events that did not exist at the time of signing the contract, that arose against the will of the seller and the buyer, the occurrence and action of which the parties could not prevent with the help of measures and means, the use of which in a given situation is rightly required and expected from the party subject to force majeure.
Force majeure means labor strikes, labor unrest, unacceptable working conditions, prohibitions or other government policies, including prohibitions on exports or imports, other licensing or other unforeseen circumstances beyond the control of each party.
Product insurance. The parties usually include in the contract provisions for insuring goods at various stages of product distribution and distribute costs between the seller and the buyer. The insurance contract itself is a separate contract; it plays the role of insurance coverage for the interests of the seller and buyer.
To complete this article of the contract, you must become familiar with the following theoretical concepts.
Insurance policy is a certificate (certificate), a document issued by the insurer to certify the insurance contract and containing its terms. It includes insurance conditions worked out in world practice, various standard and special clauses.
Insurance risk is the probability of an event or set of events against which insurance is provided. For example, exporter risk insurance, i.e. insurance against losses on export operations is provided by specialized institutions, usually banks.
The insurance amount is a certain calculation based on the current rates of insurance payments and the amount of payments upon the occurrence of an insured event.
An insured event is an actual event that entailed certain consequences or losses, confirmed by special acts and other documents.
The volume of insurance coverage is determined by the insurance risk, the extent to which losses are compensated.
Usually the cargo is insured in favor of the buyer.
The cost for which the cargo is insured is calculated as the sum of the cost of the goods, freight, shipment and a 5-10% surcharge to cover administrative costs and price increases.
An insurance contract can be concluded on the basis of one of three conditions:
1) with responsibility for all risks;
2) with liability for a partial accident;
3) without liability for damage, except in cases of wreck.
Arbitration. A foreign trade contract must establish a procedure for resolving disputes that cannot be resolved through negotiations. The legislation of the Russian Federation recognizes the parties' Agreement on Arbitration as included in the contract. A Russian organization, under an arbitration agreement with its foreign partner, may refer the dispute to a foreign arbitration commission, for example in Stockholm.
An arbitration clause is an agreement to arbitrate a dispute that has arisen or that may arise in the future. The arbitration clause must be correctly formulated, since the competence of the arbitration tribunal to resolve the dispute depends on its creation. It must define the range of disputes; which are subject to consideration by multinational commercial arbitration bodies, and also contain
an indication of which arbitration body is competent to consider the dispute.
An arbitration court is a court chosen to resolve disputes. Unlike a general court, recourse to it occurs by agreement of the parties.
For organizations and firms, the consideration of disputes in arbitration compared to a regular court has the following advantages: short duration of consideration; relative cheapness of the procedure; competence of arbitrators. The advantage of considering disputes in arbitration is also the fact that the decision therein is not subject to appeal.
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All enterprises and organizations in statutory documents which, the possibility of foreign economic activity (FEA) has been recorded, have the right to carry out both export and import operations.
Foreign economic activity involves mutually beneficial international exchange of goods in order to obtain additional markets or acquire the necessary material resources.
In order to be an effective participant in foreign economic activity, it is necessary to know and comply with the requirements of current legislation, have the necessary information regarding the financial and currency aspects of the foreign market, know the current situation and analyze its prospects in the future.
The following types of foreign trade operations are distinguished:
Import - purchasing goods from foreign seller, with its import into the country of destination;
Re-import - the acquisition abroad of previously exported goods that have not been processed;
Export - sale of goods to a foreign buyer, with their export abroad of the exporter’s country;
Re-export is the sale abroad of previously imported foreign goods without processing them.
The basics of foreign economic activity consist of several stages. Each stage is labor-intensive in its own way, so we will dwell on each stage:
The entrepreneur decides what goods he wants to sell on the market;
He also monitors the market for the demand for these goods on the market;
Next, he finds the goods he is interested in and, accordingly, their suppliers himself or with the help of companies specializing in this field and having many years of experience, who will select the best counterparty for import or export, conduct preliminary negotiations in order to obtain the optimal commercial offer and prepare the basis for concluding a foreign economic contract;
A foreign trade contract is concluded.
Foreign trade contract (international contract) is the fundamental document of any foreign economic transaction.
Exist different kinds international contracts.
In practice, the most common purchase and sale contract is a foreign trade contract. Let's look at it separately.
The contract has certain requirements that must be met.
A foreign trade contract must be drawn up taking into account the state, and especially the customs legislation of both parties. If any points were missed during the contract negotiation process, it will be necessary to stipulate them in additional agreements, which usually happens.
A foreign trade contract has the following sections:
1. Names of the parties (also indicated in the passport of the import (export) transaction);
2. Subject of the contract - the name of the product (the purpose of the transaction) or describes the documents in which the product will be listed (for example, the product supplied under this contract is specified in the specification or annex to the contract and is an integral part of it);
3. Form for approval of individual supplies (application, specification, etc.) in the case of a framework contract;
4. Contract amount in the contract currency (also indicated in the passport of the import (export) transaction);
5. Currency of the contract (for example - Russian rubles, US dollars, Euros) (also indicated in the passport of the import (export) transaction);
6. Terms of payment (advance payment in %, payment after receiving the goods with an indication of the deadline) The same conditions are prescribed in the passport of the import (export) transaction;
7. Delivery times (must be tied to a specific moment);
8. Delivery terms according to Incoterms 2010;
9. List of documents sent by the supplier with the goods;
10. Payment return period in case of complete or partial non-delivery of goods;
11. Sanctions for violation of contract terms;
12. Warranty and actions in case of delivery that does not meet the terms of the contract;
13. Force majeure;
14. Applicable law;
15. Place of arbitration;
16. Duration of the contract (also indicated in the passport of the import (export) transaction);
17. Legal and actual addresses and bank details of the parties;
IN standard version the contract amount always coincides with the amount specified in the main specification or annex for the goods. Such contracts are accepted when customs clearance without any additional questions from customs authorities.
Framework contract.
In the case of a framework contract, things are not so smooth.
The attitude of customs authorities towards framework contracts is ambiguous.
If the cost of goods during customs clearance is higher than the control indicators indicated in the risk management system (RMS), they do not attract particularly close attention.
But in the opposite case, when a foreign trade participant needs to prove the declared customs value, the customs authority immediately indicates that the contract is a framework contract and does not comply necessary requirements, which is one of the reasons for the possible refusal of the customs authority to accept the customs value declared in the declaration for goods.
So why do framework contracts cause negative attitudes from customs authorities?
When contracts do not define at least one of the essential conditions, and all essential conditions are determined for each delivery separately, such contracts should be classified as “framework”.
Essential conditions are the conditions necessary for concluding a contract.
When referring foreign trade agreements(contracts) to the “framework” should be guided by the rules of international private law and the civil law of other countries.
According to Clause 1 Article 14, UN Convention on Contracts for the International Sale of Sales(Vienna, 04/11/1980) a proposal to conclude a contract addressed to one or more specific persons is an offer if it is sufficiently specific and expresses the intention of the offeror to be bound in the event of acceptance. A proposal is sufficiently definite if it identifies the product and directly or indirectly establishes the quantity and price, or provides for the procedure for their determination. Thus, we can talk about reaching an agreement between the parties to the contract if it is reached on the name of the product, quantity and price, or establishes the procedure for determining them.
Regarding the provisions of the civil law of the Russian Federation, the Agreement must comply with the rules obligatory for the parties established by law (namely part two of the Civil Code of the Russian Federation) and other legal acts (mandatory norms), valid at the time of its conclusion(according to Article 422 of the Civil Code of the Russian Federation). The specifics of concluding and executing a supply contract under Russian law are provided for in paragraph 3 of Chapter 30 of the Civil Code of the Russian Federation. Also, the general provisions on purchase and sale apply to delivery as a type of purchase and sale agreement (Articles 465, 467, 469, 481, 485, 486 of the Civil Code of the Russian Federation).
The essential conditions, the absence of which in the supply contract entails its recognition as not concluded, include:
1. name and quantity of goods(Clause 3 of Article 455 of the Civil Code of the Russian Federation);
2. delivery time(Article 506 of the Civil Code of the Russian Federation).
According to the general rule established Article 485 GK RF, the condition on the price of the goods is not one of the essential, in the absence of which the purchase and sale agreement is not considered concluded. This general rule does not apply unless otherwise provided for certain types of sales contracts. For a supply contract, the condition on the price of the goods is not essential.
In the case of an international contract, it should be taken into account that, along with the norms of international treaties (including conventions), the parties apply the norms of national law.
In connection with this, the customs authorities consider it possible, when examining the presence of essential conditions in the contract, to be guided by the Letter of the Central Bank of the Russian Federation dated July 15, 1996 N 300 " on "Recommendations on the minimum requirements for mandatory details and the form of foreign trade contracts"
Based on the latter, foreign trade contracts must indicate:
1. Subject of contract - name and full characteristics of the product, assortment, labeling of the product, volume, weight, quantity of the product;
2. Price and amount - total contract amount and unit price. In cases where the price per unit of goods and the contract amount cannot be accurately established on the date of signing the contract, a detailed price formula or conditions for its determination are provided;
3. Delivery time - date of completion of deliveries and/or schedule of deliveries of specific consignments of goods indicating the duration of the contract during which deliveries of goods and mutual settlements under the contract must be completed.
Taking into account the above, in the absence of the above essential conditions, supply agreements (contracts) are determined for customs purposes, namely, when distributing powers to control customs value between customs authorities depending on the type of contract, as framework contracts, which entails enhanced control of the customs value of goods , supplied under framework contracts.
