Personal Student ID number

A20317975

“Arranging the international carriage of goods”

Question I

Having analyzed your situation we came out with some solution which relief your state. Concern liability, risks of transportation and import customs payment, our advice to you will be - to draft into your contract one of the the International Commercial Terms (Incoterms) which fits your current situation best. Before calculating sales price and negotiate a sales contract, it must be determined what responsibilities and expenses are assigned to the seller and the buyer. The Incoterms were created to make it easier for businessman's to understand each other and their mutual obligations concern shipment of goods.

Incoterms provide a number of standard clauses which define the ancillary services to be provided as part of a commercial contract (such as delivery, packaging or customs clearance) and which of the parties bears risks related to those services (risk of delay, damage or loss).

Incoterms are not published by a government body, but by the International Chamber of Commerce (ICC) - an international nongovernmental organization. That’s why they become binding for parties of agreement only when they are incorporated in agreement.

If the Ancient Evenings Casino wants equipment to be delivered to the port of Cairo, then there are two terms which fits this requirement - CFR and CIF. Usually foreign party don’t want to deal with the domestic insurance company and put this obligation on the domestic party. So it is more possible that the best option for both of you will be to pick the CIF term. Abbreviation CIF mean cost, insurance and freight and allocate risks of loosing or damaging goods on the seller until they are delivered and uploaded in the named port.

So, under the CIF you will be obliged to carry casino equipment to port, load it on the onto the vessel, obtain any necessary export license and to pay for insurance and delivery. Your obligations under the contract will be done once the equipment is loaded on the vessel. Risk of losses passes to buyer after all equipment is loaded on the vessel.

Under the CIF you don’t have to pay for uploading equipment in Cairo. This is buyers obligation as well as to deal with customs clearing and to ensure that the custom duties are paid. Also buyer is obligated to deliver goods form port to place of destination.

Question II

In the case of loosing or damaging the equipment while it was carried by the fault or negligence of carrier there are to different consequences for you as seller. First, if you have previously insured your equipment for damage or destroying while carried, the insurance company will pay you out for this. Then it will be that company problem to sue the carrier for loosing or destroying the equipment. But you still must consider that there are several problems with gaining the insurance. First of all the insurance company will be very strict and may reserve special rights to itself. This is done by insurer to ensure that the risks of loosing or damaging are small and he will try to take all possible steps to lessen them even more. These can be:

• inspection and approval equipment which is used upload equipment on and out of the boat;

• inspection and approval of accuracy of packaging and securing of goods;

• to choose or recommend the routs by which the equipment will be transported;

• to decide what whether or season will be most acceptable for shipping.

All this steps, made by insurer, will definitely complicate your task but this is the price to be paid for security of your money, equipment and, finally, nerves.

If you decide that you don’t need insurance or if it’s conditions are too strict, then in case of loosing or damaging of equipment you will have to sue carrier by yourself. In US there are several act, which regulates relations between carrier and seller and liability of both. Such are: Bill of Lading Act and Harter Act of 1893. Under the Bill of Lading Act the carrier is liable for delivering damaged goods or any variance between goods and their description in bill of lading, misdelivery of the goods to the wrong consignee and others. It also contains provisions which limits liability of carrier under certain circumstance. The Harter Act of 1893 contains provisions which make the carrier liable for loosing or damaging of goods if:

• The damage was made due to the carrier negligence, fault or failure in proper loading, stowage, custody, care, or proper delivery; (§190);

• Loss or damage arising from carriers breach of due diligence; (§191)

Also this Act’s provisions shows in which situation carrier isn’t liable. Due to the §192 - if carrier exercise due diligence to make the vessel seaworthy and properly manned, equipped and supplies, he won’t be responsible for loosing or damaging equipment arises from dangers of the sea or other navigable waters, acts of God, or public enemies, or the inherent defect, quality or vice of the thing carried, of from insufficiency of package, or seizure under legal process, or for loss resulting from any act or omission of the shipper or owner of the goods, or any deviation in rendering such service.