International Business - Assignment Sample
Added on 2021-06-14
16 Pages3644 Words64 Views
Law
|
|
|
INTERNATIONAL BUSINESSINTRODUCTIONInternational trade has evolved as faster, efficient, reliable and better means ofconducting global business, say Burnett & Bath, (2009). Still, there is potential forimproving the methodology of international trade by optimizing communication andallowing the developing world to use resources of the developed world so they canmaximize their growth and success, as per Moens & Jones (ed), (2013). This is a casestudy of Phoenix Exports China Ltd, a recognised Export House having its works inFoshan province of China. Phoenix is exporting, for the first time, Industrial UseCooling Towers to Superior Imports Ltd, having its office in Brasilia, Brazil. Throughthis paper we take a look at how Phoenix, dealing with a new client for the first time,can conduct international trade while guarding its interests by remaining within theparameters of international trade laws through the use of necessary documentation,states Ibp Inc, (2013).1.BILL OF LADINGThe first most important document which shall be issued by Phoenix Exports and it hasto ensure that it meets the conditions stated in Article 20 of UCP. As the shipment willbe heavy and bulky, the Bill of lading (See Appnedix), being an important legaldocument, which shall be drawn between Phoenixand Sea Hawk Carriers, the shippingcompany which has been chosen by Superior Imports. Phoenix shall furnish all relevantdetails of the quantity, type of the merchandise, (including the dimensions, such asBreadth, Width and Height. Referred to as BWH) of each crate in which the CoolingTowers are packed along with the destination port and the port of lading, describesClark, (2010).This document shallalso serve as an acknowledgement of shipment,which the carrier has undertaken, for delivery of the merchandise from port of lading tothe port of destination. Bill of Lading shall accompany the goods to be shipped and isrequired to be signed byan authorized representative of Sea hawk Carriers and also bythe receiver (Superior Imports), when it gets the delivery of the merchandise, accordingto Richard (ed), (2014). Although there will be other documents accompanying this bill
of lading, the concerned parties, involved in the export, carrying and import system ofthe merchandise must carefullyreview the documents forpreventing any misuse or theftof the merchandise, as per Gibson & Fraser, (2013).LAW APPLICABLE: The following laws have been acknowledged as the enforcing laws in international tradefor legal abiding of a Bill of Lading – (i)Carriage of Goods by Sea Act, 1992 and (ii)Hague Visby Rules, which have been enforced as law in UK by virtue of s.1ch.19 of Sales of Goods Act, 1971.2.INTERNATIONAL SALE CONTRACTA.DEFINITIONArticle 4 of UCP 600 states that Phoenix Exports has the responsibility of delivering thedeclared merchandise and Superior Imports, as importer of the declared merchandise,will acquire them as per the agreed conditions of delivery, payment and the transactionschedule, assert Beaton-Wells & Fisse, (2011). Under this understanding anInternational Sale Contract is drawn between the parties to the contract for aninternational sale of merchandise. Each contract represents a different sale and is not tobe considered as a long-lasting agreement for continuous supply of the merchandise, asper Schaffer, Agusti & Dhooge, (2014).B.PARTIES TO THE CONTRACTSince both, the Exporter as well as the Importer involved in this international trade arecompanies, states Ibp Inc, (2013), each party has to declare the following –(i)Name of company, full address and Country of Origin.(ii)Type of Company: Public Limited; Limited Liability; Private Limited. (iii)Name and position of company’s authorized signatory signing theagreement. (iv)Tax related ID number of all companies participating in the transaction.C.MAIN CLAUSES
Following are some of the important clauses for an International Sale Contract –(i)Price ClauseThe total price of the merchandise (See Appendix for Invoice Costs) which the SuperiorImports undertakes to pay Phoenix Exports is $148,500.00 (US$ One hundred forty-eight thousand and five hundred) (write in numbers and words). Both parties haveundertaken the renegotiation of the agreed prices if they are affected because of anysignificant changes occurring in the international market, such as political, economic orsocial, either in the country of origin or destination of the merchandise, provided suchchanges can be detrimental to the interests of all parties to the contract, assert Moens &Jones (ed), (2013).(ii)Delivery Conditions ClausePhoenix Exports will deliver the merchandise at Port of Rio De Janeiro (mention thewarehouse, port or airport), City of Rio De Janeiro, Brazil (mention city and country),under conditions of Cost Insurance & Freight (CIF)(mention INCOTERM). In casethe Superior Imports fails to take charge of the merchandise upon arrival at Port of RioDe Janeiro, Phoenix Exports will be entitled to demand the complete fulfillment of thisSale Contract and the payment of the merchandise at the agreed price stated in thisContract, as per Latimer, (2012).(iii)Means of Payment ClauseSuperior Imports undertakes to pay the total amount as appearing above in this Contract.The aforesaid payment will be effected by alternative “C” by the Importer – Alternative A: Cash, Check or Bank Transfer to the account and bank designated by theExporter. Alternative B: Bills of Exchange or Direct Debit to the account and bank designated bythe Exporter. Alternative C: Irrevocable and Guaranteed Letter of Credit payable to the accountand bank designated by the Phoenix Exports, states Clark, (2010). (iv)Delivery Period ClausePhoenix Exports undertakes to deliver the merchandise within 60 (Sixty) calendar days(mention in numbers and words) upon receipt of confirmation, in writing, of themerchandise in question and after all the payment conditions stated in this Contracthave been complied with. The agreed delivery period can be altered by either party incase of Force Majeure or any unforeseen circumstances, as per Gibson & Fraser,(2013).
(v)Ownership ClauseParties to this Contract understand that the merchandise hereunder will remain theproperty of Phoenix Exports, till the time Superior Imports makes all paymentscompletely. Till the clearance of the payment in full, the merchandise will be deemed asa deposit in the possession of Superior Imports. Superior Imports will fulfill are theconditions of this Contract upon receiving the merchandise and while being inpossession with due diligence, according to Burnett & Bath, (2009). D.LAW APPLICABLEAn International Sale Contract is administered under the following international laws – (i)United Nations Convention on Contracts for the International Sale of Goods(Vienna Convention). (ii)UNIDROIT Principles of International Commercial Contracts. (iii)Uniform Law for the International Sale of Goods.3.BILLS OF EXCHANGEThe governing law for Bills of Exchange is UK's Bill of Exchange Act, (1882), whichstates that Bills of Exchange (See Appendix) isprimarily meant to act as promissorynotes ininternational trade. Phoenix Exports, while conducting the transaction, is toaddress thebills of exchangeto Superior Imports, according to Moens & Jones (ed),(2013). There will also be a third entity, JP Morgan Chase Bank of New York, whichshall act as guarantor for thisbills of exchange,to facilitate payment to the PhoenixExports by promising to get it expiated from Banco PanAmericano S/A, Brasilia, thebank representing the interests of Superior Imports, as per Schaffer, Agusti & Dhooge,(2014). This is also expressed in Clause (c) of Article 6 of UCP 600, which states that"A credit must not be issued available by a draft drawn on the applicant." And inClause (e) it is stated that “Except as provided in sub-article 29 (a), a presentation byor on behalf of the beneficiary must be made on or before the expiry date.”(Source:UCP 600).This Bills of Exchange becomes essential to be covered under the guarantee of JPMorgan Chase Bank of New York, both on behalf of Phoenix Exports as well as
End of preview
Want to access all the pages? Upload your documents or become a member.
Related Documents
International Trade Law Assignmentlg...
|10
|2174
|51
What is free or freight on board (FOB)?lg...
|5
|727
|12
International Business Law | Introductionlg...
|11
|3523
|195
International Trade Regulation and Practicelg...
|10
|2498
|20
Shipper-Carrier Obligations- International Laws and Agreementlg...
|8
|2231
|30
Past 5 Years of Pistachio Export to Canada with Graphs and Chartslg...
|8
|878
|249