With international trading activities, due to geographical distance and high value of goods, it is necessary to have clear contract terms to be legally binding. So what is a foreign trade contract? Let's find out with Giaiphapdonggoi.net!
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1. What is a foreign trade contract?
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What is a foreign trade contract?
A foreign trade contract, also known as an import-export contract, is defined as an agreement between a buyer and a seller between two different countries, in which the seller must provide the goods and deliver the relevant documents. in relation to the goods and title to the goods to the buyer and the buyer shall pay for the goods. Subject to certain terms and conditions written down in a document signed by both parties.
The seller is called the exporter and sells the goods to the other party in order to collect money for the goods.
The buyer is called the importer, transfers money to the exporter and receives the goods.
2. Features of foreign trade contracts
Features of foreign trade contract
The parties to the contract are the parties with commercial places in different countries (if the parties do not have a commercial place, it is based on the place of residence).
Objects are goods delivered or transferred from one country to another.
Offer and acceptance can be made in different countries.
3. Classification of foreign trade contracts
Classification of foreign trade contracts
Classification by time of performance of foreign trade contracts
Short-term contract: usually signed in a relatively short time and after one performance, both parties have fulfilled their obligations.
Long-term contract: usually made for a long period of time and within that period of delivery many times.
Classification according to the business content of the foreign trade contract
Export contract: A contract to sell goods abroad to carry out the transfer of such goods abroad, and at the same time transfer ownership of such goods to the buyer.
Import contract: A contract to buy goods from a foreign country and then bring them into the country for domestic consumption or for domestic production and processing.
Re-export contract: A contract to export goods that have been imported from abroad before that have not been recycled or produced domestically.
Re-import contract: means a contract to buy goods produced by their own country and sold abroad, which have not yet been processed abroad.
Export processing contract: A contract in which a domestic party imports raw materials from a foreign party for assembly, processing, and processing into products and then exports to that country, not for domestic consumption.
Classification by type of contract
Written contract.
Oral contract.
Contract by default.
However, the written form is still preferred because it has many advantages: safer, more comprehensive, and clearer.
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4. Important information about foreign trade contracts
The drafters of foreign trade contracts should note the following information:
Important information about foreign trade contracts
The contract has a number of days (The following documents are based on the information on the contract for drafting).
Company information of the seller and the buyer (company name, address, contact information, ...).
Subject (The subject of the sale and purchase contract).
Description of the goods.
The unit price of the goods, the total quantity and the total amount in the contract.
Package and shipment details.
Discharging & Loading Port.
Delivery date or delivery period.
Penalties of late shipment.
Incoterms Delivery Terms (Must have).
Payment method (Usually TTR and L/C)
Documents are provided from the exporter. (Original and copy number will be provided, delivery time for importer).
Force majeure (war, embargo, natural disaster, strike,...).
Dispute resolution (arbitration or litigation).
Signature of the person who has high power in the business (Usually a director).
Contract translation (Bilingual should be used, with clear provisions on which language to use in case of dispute).
Above is some information about foreign trade contracts that Giaiphapdonggoi.net provides to you. Hopefully from this information you will have an in-depth understanding of the contract, its features and terms, which will help you a lot in the import-export process.
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