Introduction
Ensuring the fulfillment of obligations under a concluded contract is a legal measure aimed at reducing the likelihood of dissatisfaction with the interests of a state customer as a party to a responsibility in the performance of obligations under an international contract. Since our company most often uses inks that a Japanese supplier can provide, it is necessary to conclude a reliable assurance that would reduce our company’s risks as a buyer. Incoterms (International Commerce Terms) should be used as a trademark of the International Chamber of Commerce (ICC) (Shipping Channel, 2018). Incoterms delivery terms are practically the leading standard in international business.
Proper Packing
First of all, it is essential to ensure the packaging of the goods and their fastening before transportation to protect them from mechanical and chemical damage. As a general rule, it is considered that the supplier has fulfilled its obligations at the time of transfer of the goods to the carrier. Therefore, if the cargo is damaged, a dispute may arise between the buyer, the supplier, and the transport company about who is to blame (Poliak et al., 2020). If the contract contains a clause stating the supplier’s responsibility for transportation, the supplier can recover losses from them.
Framework Agreement
Often, the supply contract is of a framework nature, and the parties also agree upon the details of the delivery of each consignment of goods. In this case, it is necessary to fix the procedure for signing such additional agreements in the contract and determine the boundaries of possible changes in terms of the contract itself (DSPCR: Framework agreements, 2023). If this is not done, there may be situations when, for each delivery, various conditions have been agreed on regarding terms, duties, and responsibilities. It can significantly complicate control over the execution of the contract and, as a result, provoke its violation.
CIP or Carriage and Insurance Paid
At this contract stage, the terms of delivery and insurance of ink from Japan are discussed. According to CIP, the seller is responsible for the delivery of the goods to the carrier. They deliver the exported goods to the place specified in the foreign trade contract (Thompson, 2022). In this case, the seller must pay the costs of loading the goods, transporting them to the destination, and monitoring their feasibility.
Terms of Delivery DDP
Under this article, the seller must pay for export customs clearance, perform import customs clearance with duties paid, and deliver the goods to the agreed destination (Shipping Things, 2018). Only unloading on arrival remains the buyer’s responsibility unless this is also passed on to the seller under a foreign trade contract.
Early Termination of the Supply Contract
Unilateral refusal or unilateral change in the supply contract is not allowed. An exception when a unilateral refusal is possible is a material breach of obligations by the counterparty. If the seller has not transferred the goods for a long time, the company can resolve this and legally terminate further cooperation.
Conclusion
Thus, the contract for the supply of goods is a quality tool in maintaining and developing the life of the enterprise. Its essence, confirmed by commercial and judicial practice, most often comes down to the interaction of the seller and the buyer. No goods are subject to transfer within the agreement framework, but the wares discussed and indicated in the signed agreement, in this case, ink from Japan.
The principal obligation of the seller under the supply contract is to transfer the required goods of good quality to the buyer. This obligation must be specified in the supply contract; otherwise, the buyer risks receiving the goods out of time and of poor quality. Our company should indicate in the contract the following areas that will protect us from risks: proper packaging, Carriage and Insurance Paid to, DPU delivery conditions, drawing up a framework contract, and indicating clauses regarding early termination of the contract.
References
Poliak, M., Tomicova, J., Jaskiewicz, M., Rudawska, A., & Lakhmetkina, N. (2020). Impact of neutralization of transport documents on the safety of the road carrier. 2020 XII International Science-Technical Conference Automotive Safety. Web.
Shipping Things. (2018). International Shipping 101 [Video]. YouTube. Web.
Shipping Channel. (2018). What are incoterms? [Video]. YouTube. Web.
Thompson, B. (2022). INCOTERMS® in 2023 guide. IncoDocs. Web.
DSPCR: Framework agreements. GOV.UK. (2023). Web.