In foreign trade practice, the document producers and issuers usually include exporters, commodity inspection agencies of the exporting country, freight companies and importers. It is generally stipulated that the documents are in English or in Chinese and English.
Contract
CONTRACT is a general term, and both the buyer and the seller can issue it. If it is produced by the seller, it can be called a sales confirmation (SALES CONFIRMATION), and if it is issued by the buyer, it can be called a purchase confirmation (PURCHASED CONFIRMATION). In addition to the same elements as domestic sales contracts, such as the names and addresses of the buyer and seller, the time and place of signing, the name, quantity, quality standards, unit price, total value and other regulations of the transaction goods, packaging requirements, delivery time, delivery place, payment method, and liability for breach of contract, additional terms can also be added according to the characteristics of different products. In addition, formal foreign trade contracts often have more detailed agreements, such as the requirements for the opening of letters of credit under letter of credit conditions, regulations on various force majeure, and other details.
For bulk cargoes that are prone to shortages during loading, unloading, storage and transportation, such as minerals, grains, agricultural and sideline products, etc., the contract often includes an “over- or under-loading” clause, which allows a certain amount of difference based on the total quantity and amount of the contract, and finally settles according to the actual delivery volume. For example, “5% MORE OR LESS ALLOWED” means that 5% more or less is allowed.
In theory, the contract should be “made in duplicate, with each party holding an original signed and sealed copy as proof”, but in foreign trade practice, it is not very demanding to copy and execute it, and a general fax copy will do as a memorandum. More reliance is still placed on commercial credit, as well as substantial control measures such as advance payments and letters of credit. The contract itself seems unimportant. It is precisely because of this that customers in some countries even make fixed contracts and leave clauses such as “effective after the letter of credit is issued” to further dilute the binding effect of the contract and distribute them everywhere as an inquiry tool. If you encounter such a contract, don’t take it seriously. Reserve time and wait until the letter of credit is received before taking action.