Chaptr 2 price term in Sales Contract.ppt

Chapter Two Price Terms Price terms in S/C Trade Terms Trade terms come into being in the process of international trade practice. It indicates the components of price, and illustrates the divisions of risks, responsibilities and costs in the delivery of goods between the buyer and seller. The main purpose of using trade terms is to simplify the business negotiation. Trade Terms International Trade Practice 1. Warsaw-Oxford Rules 1932 ? by International Law Association ? for CIF terms 2. Revised American Foreign Trade Definitions 1941 3. INCOTERM 2000 INCOTERM (1936,1953, 1967, 1976, 1980, 1990,2000) Purpose ---The purpose of Incoterms is to provide a set of international rules for the interpretation of the most commonly used trade terms in foreign trade. Thus, the uncertainties of different interpretations of such terms in different countries can be avoided or at least reduced to a considerable degree. Group EDepartureEXW　Ex Works( ... named place) Group FMain carriage unpaid　 FCA　 Free Carrier ( ... named place) FAS　 Free Alongside Ship ( ... named port of shipment) FOB 　Free On Board ( ... named port of shipment)  Group CMain carriage paid　 CFR　 Cost and Freight ( ... named port of destination) CIF 　 Cost, Insurance and Freight ( . . . named place of destination) CPT　 Carriage paid To　 ( ... named port of destination) CIP　 Carriage and Insurance Paid To　( ... named port of destination) Group DArrival DAF　 Delivered At Frontier　　　 ( ... named place) DES 　 Delivered Ex Ship ( ... named port of destination) DEQ 　 Delivered Ex Quay ( ... named port of destination) DDU 　 Delivered Duty Unpaid ( ... named place of destination) DDP　 Delivered Duty Paid ( ... named place of destination) The obligations of the buyer and seller ? A. seller A1.Provide the goods in conformity with the contract A2. Export license, other official authorization and customs formalities. A3. Transportation