Commerce department international trade

Lang Trung - Dong Da - Ha Noi - Vietnam

Tel: 42.846829 Telex: 294887 Vietco VT

Hereinafter called the Buyer

RM. 306, DONGHWA BLDG

19-2, NONHYUN - DIONG, KANGNAM - KU

SEOUL, KOREA

Cable address: TWOHANDCO, SEOUL, KOREA

Hereinafter called Seller

It has been agreed that Buyer buys and Seller sells on the terms and conditions as follows:

ARTICLE 1: DESCRIPTION - SPECIFICATION- QUALITY- QUANTITY

1. Description: NEWSPRINTING PAPER

2. Country of origin: CHINA

3. Maker's name:

4. Quality/ Specification: Substance: 49 +/- 2 g/m2

Ro IL 787 mm width

5. Quantity: 200 MT +/- 5%

6. Packing: EXPORT STANDARD

7. Marking:

Substance: 49 g/m2 +/-2

Destination: Haiphong Port

8. Destination:

HAIPHONG PORT

ARTICLE II: PRICE

Price to be understood CIF Hai Phong port including Seaworthy packing

Unit price: USD 535/MT

Total amount: USD 107,000.00

Say: United States Dollar one hundred and seven thousand only

ARTICLE III: DELIVERY TIME

40 days after L/C received

By irrevocable Letter of Credit in U.S Dollar within 180 days with 0.8% of dividend ( in favour of ) each the Seller and payable and payable on presentation to the Bank for Foreign Trade of Vietnam of the following documents, each in three copies:

- Clean on board Bill of Lading

- Commercial Invoice

- Certificate of weight and/or quantity

- Certificate of Quantity issued by the Seller and/or the Maker

- Certificate of Origin issued by Chamber of Commerce and/or the Seller

- Insurance Policy

- Receipt of Shipmaster acknowledging it duly having received 3 sets of non- negotiation shipping documents as above mentioned

- Letter of Credit will be valid for 15 days after loading completed. The Buyer and the Sller will bear bank charges in their respective country but charges for amendment or extension of L/C will be borne by party that requires.

1. Insurance :

Insurance for the contracted goods will be covered by the Seller by All Risk Policy

2. Notice of shipment:

- Pre- advice of shipment: Before shipment of the goods the Seller shall advice by cable/telex the Buyer of estimated time of shipment and name of carrying vessel

- Final advice of shipment: within 24 hours after shipment the Seller shall advice by cable/telex : Contract No, quantity, gross weight, net weight, measurement, number of packages, invoice value, name of carrying vessel, Bill of Lading number, sailing date for insurance purpose

The Buyer will be entitled to have the goods inspected by Vinaconntrol at the destination, if any discrepancy arises in respect of quantity and quality the Buyer will first lodge claim by cable with the Seller, then within 90 days from the date of discharge will make a formal claim with supporting documents, such claim shall be setlled by the Seller within 30 days from its receipt of the Buyer's formal claim

Neither party shall be held responsible for delay of failure of performance of obligations provided for herein when such delay or failure is caused by strike, fire, flood, Act of God, earthquake or any laws, rules,or regulations of any governmental authority or other conditions beyond its control which can not be forecast or provided against and provided one or both parties are subject to such obligation.

The party wishing to claim relief by reason of any of the said circumstances shall notify the other party in writing of the circumstance its commencement and ceasation and then deliver a certificate issued by the Chamber of Commerce at the place where the event or events occured as evidence thereof; In the event of delay caused by such force majeure exceeding 60 days each party shall have the right to cancel his contract, unless otherwise agreed, in which case neither party shall have the right to claim damages
ARTICLE VIII: ARBITRATION

This contract will be governed by the provision of Incoterms 1990. If any dispute that arises under this contract can not be settled by an amicable agreement between the two sides, the matter shall be settled by the Internatiional Commercial Arbitration in Paris in accordance with its rules

The Buyer shall give a guarantee pursuant to procedure at the Bank for Foreign Trade of Vietnam

1. Bảo hiểm: bảo hiểm của hàng hoá do Người bán chịu với điều kiện Mọi Rủi Ro

2. Thông báo giao hàng:

- Thông báo trước khi giao hàng: Trước khi gửi hàng, người bán sẽ thông báo cho người Mua bằng điện hoặc telex về thời gian giao hàng dự tính và tên tàu vận chuyển.

- Thông báo cuối cùng về giao hàng : Trong vòng 24 giờ sau khi gửi hàng, Người bán sẽ thông báo bằng điện hoặc telex về: số hợp đồng, số lượng, trọng lượng cả bì, trọng lượng tịnh, kích thước (dung tích), số kiện, giá trị hoá đơn, tên tàu vận chuyển, số vận đơn, ngày tàu rời cảng...

Ðiều 6. Kiểm tra tại cảng dỡ hàng

Người Mua có quyền nhờ VINACONTROL kiểm tra hàng ở cảng đến, nếu có sự không khớp nhau về số lượng và chất lượng thì trước tiên Người Mua sẽ gửi điện khiếu nại cho người Bán, sau đó trong vòng 90 ngày kể từ ngày dỡ hàng người Mua phải làm khiếu nại chính thức đòi bồi thường cùng các tài liệu kèm theo, người Bán phải giải quyết cho người Mua trong vòng 30 ngày nhận được yêu cầu chính thức đòi bồi thường của người Mua

Ðiều 7: Trường hợp bất khả kháng

Không bên nào phải chịu trách nhiệm về sự trì hoãn hoặc sự không thực hiện được những nghĩa vụ với điều kiện là sự trì hoãn hoặc sự không thực hiện được những nghĩa vụ đó xảy ra do đình công, hoả hoạn, lũ lụt, tác động của thiên nhiên, động đất, hoặc những luật lệ qui tắc, qui định của các nhà chức trách, hoặc những điều kiện khác không thể dự đoán hoặc lường trước được

Bên yêu cầu khiếu nại về thiệt hại do bất kì trường hợp nào đã nêu sẽ thông báo cho bên bằng văn bản và theo đó gửi một giấy chứng nhận do Phòng Thương mại tại nơi xảy ra sự việc cấp, như là chứng cứ của việc đó. Khi sự trì hoãn do trường hợp bất khả kháng nêu trên mà vượt quá 60 ngày, mỗi bên của hợp đồng có quyền huỷ bỏ hợp đồng này, trong trường hợp đó không bên nào có quyền khiếu nại cuối cùng về những thiệt hại

Ðiều 8: Trọng tài

Hợp đồng này chịu sự chi phối của Incoterms 1990. Những tranh chấp phát sinh từ hợp đồng này mà hai bên không giải quyết bằng thương lượng sẽ được giải quyết bởi Trọng tài Thương mại Quốc tế tại Paris, theo các qui chế xét xử của nó

Ðiều 9: Các điều kiện khác

Người Mua sẽ phải làm thủ tục bảo lãnh tại ngân hàng Ngoại thương Việt Nam

Người Bán

Người Mua

11-17
3. Risk, the Contract, and the Law

The law offers protection to both exporter and importer. What is this “law”? And how can the two parties ensure that they achieve the best possible protection?

Law exists in two forms, public and private. Public law regulates the relationship between the citizen and the state. Private law regulates relationship between private citizens (or companies). Most provisions of the private law are disposive—the parties to a contract are free to change or ignore them. A well written contract clarifies exactly what the parties have agreed and, supplementary to their agreement, which law they have chosen to fill in any gaps. Contract law belongs to the private law.

A negotiated, written contract is a key safeguard against the risks of exporting.

IN MORE DEPTH

Successful trade depends on peaceful and orderly movement of goods and money between communities. In the modem world, the main safeguard of peace and order is probably the law. Within most societies, law exists in two forms, public and private. The public law is imposed by a government within a specific territory: the citizen or foreigner within this territory is obliged to obey; private law regulates the rights of individual citizens among themselves. (Not all legal systems make this absolute distinction, but it helps our present purpose. The public law of a country controls, for example, taxation, immigration, crime, use of foreign exchange, and such matters. Private law controls, typically, contracts of sale, employment contracts, contracts to lend money, and so on. One branch of private law particularly concerns us here, contract law. which looks at the agreements citizens or companies make with each other.

Some trades—for example, the diamond trade in Antwerp—have well established rules familiar to everyone in the business; two dealers need agree nothing more than scope and price. Similarly, rice merchants in Southeast Asia seldom enter elaborate agreements—the rules are too well known to both sides.

More common is the second approach: the use of general conditions of sale or of purchase. General conditions work in this way: a buyer sends an order to an exporter. Somewhere on the order are the words: 'This order is subject to our General Conditions of Purchase as printed on the back of this Order Form." When the exporter sends the order confirmation for the invoice) it, in turn, bears the words: "All goods are supplied subject to our General Conditions of Sale as printed on the back of this Order Confirmation." You have probably seen such general conditions; they are usually in very small print and regulate every foreseeable problem in favor of the party who drafted them.⁷ The problem here is obvious: each side says, "My conditions apply." But neither side has agreed to the other's conditions. In such a situation, the two sides have very different expectations, and disputes are inevitable. If a dispute goes before a court, the judge must give one set of conditions preference. But which? The answer is unpre­dictable: and unpredictability is another name for risk. Exporting on the basis of general conditions—especially if the buyer does not agree to them in advance--is unnecessarily risky for the exporter.

The third approach to export agreements is the most professional and the safest: negotiating the terms of the agreement and putting them in writing—the negotiated written contract. The advantages are obvious. First, clarity: all the crucial issues are resolved during negotiation, making disputes unlikely. Then workability: both sides know what they have to do and are confident that they can do it: this creates a good working relationship. And finally enforceability: if a dispute arises, both sides can reread the contract and find a clear statement of their mutual rights and duties. Usually the dispute can be resolved without the help (and expense) of the courts—people seldom go to law when the case is clear.

The mention of lawyers brings us to the main problem with contracts: because they are normally drafted by a lawyer, they are expensive and sometimes difficult to understand. These problems are not insoluble: in the following chapters you will find advice on many common provisions found in export contracts. That will help you with most of the "jargon." You will also find a "model sales contract." Using a model contract for your own export business has a number of advantages: by completing the various clauses, you ensure that you have negotiated all the essentials; by using the options in the model contract, you gain flexibility during negotiations; and by establishing a sound legal relationship, you help things runs smoothly in future. (If you are in doubt, you should ask a lawyer to check the final version of your contract.)

The best safeguard against the risks of exporting is a contract that is clear, workable and enforceable.