Тема №9: Claims.

However, in spite of every possible care and attention that is given to contracts letters of complaint happen to arrive rather frequently because of various infringements.

The following kinds of claims are often made by Buyers:

1 )claims arising from the delivery of wrong goods, damaged goods or substandard goods; 2)claims connected with delays of one kind or another:

3)claims owing to goods missing from delivery (i.e. short-shipment or short-delivery);

4)claims that concern errors in carrying out an order. These may be caused by mis-typing of figures. mis-reading of numbers, misdirection of goods, wrong packing and so on.

Sellers most .frequently make claims on Buyers because of default of payment.

As a rule a customer will not complain unless he has a good reason. If the customer's complaint is well-grounded, the settlement is comparatively easy: the error will be admitted and the responsible party will meet the claim fully or partly. In other words, the dissatisfied party will get full or partial compensation for the losses which they suffered. Thus the matter is settled amicably.

Much more difficult is the case where the customer's complaint is not justified. The responsible party must carefully explain why the claim is declined and try to persuade the dissatisfied party to withdraw the claim. Settling commercial disputes by arbitration is practised if the parties in dispute cannot reach mutual understanding. In this case the parties may refer the matter to the International Commercial Arbitration Court under the Chamber of Commerce of the Russian Federation in Moscow. Then the case is heard before a tribunal comprising three arbitrators. The award is made by a majority.

Stocks.

The act of issuing shares – i. e. offering them for sale to the public – for the first time, is known as floating a company.

Companies generally use a bank to underwrite the issue.

Newer and smaller company trade on “over-the-counter” markets.

Successful companies can apply to have their shares traded on the major stock exchanges.

Shares generally entitle their owners to vote at companies’ General Meetings, to elect company directors, and to receive a proportion of distributed profits in the form of a dividend.

The market price of a share - the price quoted at any given time on the stock exchange, which reflects how well or badly the company is doing. It may differ radically from its nominal value.

During the accounting period speculators can buy shares hoping to resell them at a higher price before they actually pay for them, or can sell shares, hoping to buy them back at a lower price.

If a company wishes to raise more money for expansion it can issue new shares. These are frequently offered to existing shareholders at less than their market price: this is known as a rights issue. Companies may also turn part of their profit into capital by issuing new shares to shareholders instead of paying dividends: this is known as a bonus issue.

If a company sells shares at above their par value, this amount is recorded in financial statements as share premium.