Transcript International Sales - Lectures: Section 5

INTERNATIONAL SALES LAW - seminar 2004
ISL
I
ISL: objectives, functions and structure
II
Management of information on ISL
III
Contractual Risk Management in Transnational Sales Transactions
IV
Management of risk of contractual disputes
V
Management of risk of contract breach
VI
Management of risk of loss of or damage to the goods
VII
Management of risk of changed circumstances
VIII
Case study
IX
Case studies
ISL
Management of risk of loss of or damage to the goods
Default distribution of the risk in sales law
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III
IV
V
VI
VII
VIII
IX
CISG art. 67:
ISC
(1) If the contract of sale involves carriage of the
goods and the seller
is art.
not 68:
bound to hand them
CISG
over at a particular place, the risk passes to the
buyer
when
the goods
are handed
over
to thepasses
first
The risk
in respect
of goods
sold in
transit
carrier
for from
transmission
buyer of
in
to the buyer
the time oftothe the
conclusions
accordance
the contract
of sale.
If the
seller
the of the with
contract.
However,
if the
circumbound
the goods
overistoassumed
a carrier
a
stances tosohand
indicate,
the risk
byatthe
particular
thetherisk
doeswere
not handed
pass toover
the
buyer from place,
the time
goods
buyer
the goods
handed
to the
to theuntil
carrier
who are
issued
the over
documents
carrier
at that
fact that Nevertheless,
the seller is
embodying
the place.
contractThe
of carriage.
authorized
to retain
documents
controlling
if at the time
of the the
conclusion
of the
contractthe
of
disposition
of knew
the goods
doeshave
not known
affect that
the
sale the seller
or ought
passage
of had
the risk.
the goods
been lost or damaged and did not
(2)
Nevertheless,
riskthe
does
pass to isthe
disclose this to the the
buyer,
lossnot
or damage
at
buyer
theseller.
goods are clearly
identified to theLAW
CONTRACT
CONTRACTING
the riskuntil
of the
contract, whether by markings on the goods, by
shipping documents, by notice given to the buyer
or otherwise.
- CISG art. 66-70, 79
ISL
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IV
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VII
VIII
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Management of risk of loss of or damage to the goods
Default distribution of the risk in contract law
CENTRAL TCL database
No. IV.4.6.
ISC
Rights and Duties of the partied under
”FOB”, ”FAS”, ”CIF” and ”CF”
”If the parties have agreed on a sale "FOB", "FAS",
"CIF" or "CF", the respective rights and duties of the
parties under the contract are to be determined
according to the latest version of the International
Commercial Terms (INCOTERMS) issued by the
International Chamber of Commerce (ICC) unless the
parties have indicated that a different meaning is to be
attributed to the term used.”
- PECL chapters 7 to 9
- UPICC chapters 6
and 7
CONTRACTING
- CENTRAL TLDB
No. IV.4.6 and Ch. V
to IX
- CISG art. 66-70, 79
ISL
Management of risk of loss of or damage to the goods
Contractual allocation of the risk in contracting practice
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II
ISC
III
IV
V
VI
VII
VIII
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CONTRACTING
- PECL chapters 7 to 9
- UPICC chapters 6
and 7
- CENTRAL TLDB
No. IV.4.6 and Ch. V
to IX
- CISG art. 66-70, 79
Management of risk of loss of or damage to the goods
A Brief Overview on Transfer of:
ISL
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Goods:
II
Sales
Documents:
III
Finance
Sales
IV
Transport
Property right:
V
S
VI
Payment:
Sales
VII
Finance
Risk of loss of or damage to the goods:
VIII
IX
B
Finance
Sales
Sales
Insurance
ISL
Management of risk of loss of or damage to the goods
Contractual allocation of the risk in contracting practice
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II
ISC
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IV
V
VI
VII
VIII
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- Incoterms & Combiterms
- Institute Cargo Clauses
- Exemption-clauses
- Force majeure -clauses
- Hardship-clauses
- PECL chapters 7 to 9
- UPICC chapters 6
and 7
- CENTRAL TLDB
No. IV.4.6 and Ch. V
to IX
- CISG art. 66-70, 79
ISL
Management of risk of loss of or damage to the goods
Contractual allocation of the risk in contracting practice
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II
III
V
TRADE TERMS
CONCERNING
CARRIAGE OF GOODS
VI
INCOTERMS 2000
IV
VII
VIII
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D-clauses
Division of costs:
B
B
B
B
B
B
B
B
C-clauses
F-clauses
EXW
S
c
F
B
D-clauses
S?
S?
B
B
B
B
B
B
C-clauses
C-clauses
F-clauses
FCA
EXW
S
c
F
B
D-clauses
S
S
B
S
B
B
B
B
B
C-clauses
C-clauses
FOB
FAS
FCA
EXW
S
c
F
B
D-clauses
C-clauses
C-clauses
FOB
FAS
FCA
EXW
S
c
F
B
S
S
S
D-clauses
S/B
S
S
S/B
B
B
CIF
CFR
FOB
FAS
FCA
EXW
S
c
F
B
S
S
S
(B)
S
S
S/B S/B? S/B?
D-clauses
CIP
CPT
CIF
CFR
FOB
FAS
FCA
EXW
S
c
F
B
D-clauses
CIP
CPT
CIF
CFR
FOB
FAS
FCA
EXW
S
c
F
B
DEQ
DES
CIP
S
S
CPT
S
(S)
S
B
S
B
B
CIF
CFR
FOB
FAS
FCA
EXW
S
c
F
B
DDP
DDU
DAF
DEQ
DES
CIP
S
S
S
(S)
S
S
S+
B
S
B
S
CPT
CIF
CFR
FOB
FAS
FCA
EXW
S
c
F
B
DDP
DDU
DAF
DEQ
DES
CIP
CPT
CIF
CFR
FOB
FAS
FCA
EXW
S
c
F
B
D-clauses
C-clauses
F-clauses
EXW
S
c
F
B
ISL
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Management of risk of loss of or damage to the goods
Contractual allocation of the risk in contracting practice
The ICC Model
International Sale Contract
ICC Publication No 556
ORGALIME S 2000
II
III
GENERAL CONDITIONS
for the supply of mechanical, electrical and
electronic products
ISC
B. GENERAL CONDITIONS
Art. 8
Contractual term of delivery
DELIVERY. PASSING OF RISK
IV
V
VI
VII
VIII
IX
”Unless otherwise agreed, delivery shall be
”Ex Works” (EXW).”
Clause 9.
”Any agreed trade term shall be constructed in
accordance with the INCOTERMS in force
at the formation of the contract. If no trade
term is specifically agreed, the delivery shall
B. GENERAL CONDITIONS
be Ex Works (EXW). If in the case of delivery
Art. 1 General
Ex works, the Supplier, at the request of the
- PECL chapters
7 toundertakes
9
- Incoterms & Combiterms
Art. 1.3
Purchaser,
to send the Product to its
- UPICC chapters
6 the risk will pass not later than
destination,
- Institute Cargo Clauses
referance made to trade terms (such
CISG over
art. 66-70,
79
and as
7 when the Product is- handed
to the first
-”Any
Exemption-clauses
EXW, FCA, etc.) is deemed to be made
to carrier.
Partial shipments shall be permitted
- CENTRAL
TLDB
-the
Force
majeure
-clauses
relevant term of Incoterms published
unless
No. IV.4.6
and otherwise
Ch. V agreed.”
-byHardship-clauses
the International Chamber of Commerce.”
The ICC Model
International Sale Contract
ICC Publication No 556
to IX
ISL
Management of risk of loss of or damage to the goods
Contractual allocation of the risk in contracting practice
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II
ISC
III
ORGALIME S 2000
GENERAL CONDITIONS
for the supply of mechanical, electrical and
electronic products
IV
V
Consequential Losses
VI
VII
VIII
IX
- Incoterms & Combiterms
- Institute Cargo Clauses
- Exemption-clauses
- Force majeure -clauses
- Hardship-clauses
”43. Save as elsewhere stated in these
conditions there shall be no liability for either
- party
PECL towards
chapters 7the
to 9other party for loss of
- production,
UPICC chapters
loss 6of profit, loss of use, loss of
- CISG art.
66-70, 79
and 7
contracts
or for any consequential
or indirect
- loss
CENTRAL
TLDB
whatsoever.”
No. IV.4.6 and Ch. V
to IX
ISL
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IV
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VI
VII
VIII
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Management of risk of loss of or damage to the goods
Contractual allocation of the risk in contracting practice
Similarly:
ICC
ORGALIME S 2000
FORCE MAJEURE Clause 2003
FORCE MAJEURE
NL 01 E
39. EitherISC
party shall be entitled to suspend
Art. 36
1. Unless otherwise agreed in the contract between the parties expressly
performance of his obligations under the contract to
or impliedly, where a party to a contract fails to perform one or more of
the extent that such performance is impeded or
its contractual duties, the consequences set out in paragraphs 4 to 9 of
made unreasonably onerous by any of the
Compare:
this Clause will follow if and to the extent that that party proves...
following circumstances: industrial disputes and any
2. Where a contracting party fails to perform one or more of its
other circumstance beyond the control of the
ICC Model International
contractual duties because of default by a third party whom it has
parties such as fire, war, extensive military
Sale Contract
engaged...
mobilization, insurrection, requisition, seizure,
B. General conditions
3.-6. ...
embargo, restrictions in the use of power and defects
Art. 13 Force majeure
7. A party invoking this Clause is under an obligation to take all
or delays in deliveries by sub-contractors caused by
reasonable means to limit the effect of the impediment or event
any such circumstance referred to in this Clause.
invoked upon performance of its contractual duties...
A circumstance referred to in this Clause whether
PECL
chapters 7deprived
to 9
8. (on
termination due- to
substansially
expectations, within a
- Incoterms
& Combiterms
occurring prior to or after the formation of the
reasonable
period) - UPICC chapters 6
- Institute Cargo
Clauses
contract shall give a right to suspension only if its
art. 66-70,
and 7 party has, by reason -ofCISG
9.
...
where
either
contracting
anything
done by79
- Exemption-clauses
effect on the performance of the contract could not
- CENTRAL
another-clauses
contracting party...
derivedTLDB
a benifit before termination... duty
- Force majeure
be foreseen at the time of the formation of the
No. IV.4.6
andequivalent
Ch. V
to pay the other party...
a sum...
to the value of such
- Hardship-clauses
contract.
to IX
benefit.
Management of risk of loss of or damage to the goods
Contractual allocation of the risk in contracting practice
ISL
I
ICC
II
HARDSHIP Clause 2003
ISC
III
1.
A party to a contract is bound to perform... even if... more onerous than
could reasonably have been anticipated...
IV
2.
Notwithstanding paragraph 1...
V
VI
VII
VIII
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[a] ... excessively onerous...beyond its reasonable control... could not
reasonably have been expected to have taken into account... and...
[b] ... could not reasonably have avoided or overcome the event of its
consequences,
- PECL
chapters
7 to 9 time... to negotiate
- Incoterms
Combiterms
the&parties
are bound,
within
reasonable
- UPICC chapters 6
contractual terms...
- Institutealternative
Cargo Clauses
- CISG art. 66-70, 79
and 7
- Exemption-clauses
CENTRAL
TLDB
3. majeure
... not -clauses
agreed...the -Party
invoking
this Clause is entitled to
- Force
No. IV.4.6 and Ch. V
termination of the contract.
- Hardship-clauses
to IX
Go to section
VII Management of risk of changed circumstances