13

CONTRACT №3

Notes:

1)“ Продавец” and “ Покупатель” are singular or plural: Seller(s), Buyer(s) and are always written with capital letters ( with the definite article the or without it). In Preamble they are quoted “Seller(s), “Buyer(s)”.

2)In order to express the meaning of “должен”, “обязан” in contracts the verbs shall, will, to be to are used instead of must:

- The Sellers shall deliver. – Продавец должен поставить (поставит, поставляет).

- The Buyers will pay in advance 10% of the total value of the contract.-Покупатель должен оплатить (оплатит, оплачивает) 10% общей стоимости контракта авансом.

- Payment is to be effected within 10 days.- Платеж должен быть осуществлен

(осуществляется) в течение 10 дней.

PRICE AND TOTAL VALUE OF THE CONTRACT

This clause stipulates the price per unit, total value, currency and terms of delivery. Trade between commercial organizations is regulated by the “Incoterms” international official issue of 1980 as it stipulates various terms concerning transport and insurance costs issued by International Chamber of Commerce for use in international trade contracts.

There are various basic terms of delivery.

Cost, insurance, freight (CIF). One of the basic terms of delivery of export contracts in accordance with which the seller pays for transportation to the port of destination, costs of loading and arranges marine insurance of the goods for the time of transportation. According to c.i.f. terms the seller sends the buyer (through the bank) the documents entitling the buyer to the goods. The documents transferred are: a bill of lading, insurance policy, a waybill, sometimes such documents as a Certificate of Origin, a Certificate of Quality and an Export Licence. To accept the goods the buyer undertakes to effect payment as soon as he receives the documents. Sometimes it is considered that according to c.i.f. terms of the contract the buyer pays for the documents but not for the goods: as long as the documents received are in order the buyer should pay no matter whether the goods were lost or damaged in transit. In that case the buyer holding the Insurance Policy can claim for compensation for the goods damaged or lost in transit.

14

Cost, insurance, freight, commission, interest (CIFCI). According to c.i.f.c.i. terms of the contract the seller apart from paying the cost of the goods, insurance and freight pays the buyer additionally a commission fee and an interest charged by the seller’s bank for documents transfer.

Cost and freight (C & F). A condition of sale for goods carried by sea where the seller pays for loading and transporting goods but the buyer pays the insurance costs once the goods have been loaded. The buyer orders the goods on a cost and freight basis, preferring to make insurance arrangements personally.

Free alongside ship (FAS). A condition of sale where the seller pays for transportation and insurance of the goods until they arrived at the ship. The buyer is then responsible for the actual loading of the goods.

Free on board (FOB). Free on rail (FOR). Free on car (FOC). Free on truck (FOT).

Terms of delivery according to which the seller pays for transportation of goods to the point of loading and their consequent shipment on board a ship, plane on a car. The seller also pays the insurance of the goods to the place of loading. Afterwards transportation and insurance costs are borne by a consignee. Besides, there is one more term of delivery called free on board and trimmed which in itself is a condition of sale used in trade with coal, according to which the seller pays for the delivery and the loading of coal onto a vessel, and guarantees its correct placing.

Free on quay (FOQ). A term of delivery according to which the seller is to take for his own account the goods to the quay.

Ex-dock. Ex-quay. Ex-wharf. Of a price for goods where the seller pays all the costs for delivery to a named port, including unloading onto the quay and onto road or rail vehicles.

Ex-factory. Ex-warehouse. Ex-works (x wks). Ex-mill. Of a price where the buyer pays for transporting the goods away from the factory/warehouse.

Ex-ship (x shp). (Free overboard, Free overside). Of a price for the goods where the seller pays for all costs up to delivery at a named port, but the buyer pays for unloading the goods and transporting them from the port. There are two more terms of delivery that are normally used either in trade between companies for comparatively short distances/time of delivery, or between wholesalers and small retailers.

Ex-stock (x stk). Of a price for goods that applies to present supplies. The price of future supplies may change.

Ex-store (x store). Of a price for goods that includes delivery to a store, but the buyer pays for transporting goods away from the store.