国际商法第二版英文版姜作利课件

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1、Chapter one Introduction to International Business LawI what is international business law? International business law is the body of rules and norms that regulates business activities carried outside the legal boundaries of states. In particular, it regulates the business transactions of private pe

2、rsons internationally, and the relationship of international commercial organizations. 国际商法是调整国际商法是调整跨国商事活动跨国商事活动的法律规范的总称。它调整的法律规范的总称。它调整的是的是国际私人商事交易关系国际私人商事交易关系和国际商事组织间的关系和国际商事组织间的关系. The scope of international business lawLaw for international trading of goodsCompany lawNegotiable instrument lawMa

3、ritime law Insurance lawLaw of international technology transferIndustrial property law International investment lawInternational financial lawInternational tax law Law of international disputes settlementII History of International Business Law1. the origin: Hammurabi Codes 汉穆拉比法典2. the Roman law:

4、Jus Civil ( civil law)市民法 and Jus Gentium ( public international law)万民法3. the Rhode law:罗得法4. Law Merchants: 商人（习惯）法5. the common law: 普通法III Sources of international business lawA National lawThe most important source.Take China as an example:The Contract LawTrademark LawChinese-Foreign joint Vent

5、ure (Cooperative) Law, The Civil Procedure LawArbitration LawIII Sources of international business lawB International treaties and conventionsDifferences between treaties and convention:The most important international conventions: The United nations Convention on Contract for the International Sale

6、s of Goods（CISG，联合国国际货物销售合同公约） Convention for the Unification of Certain Rules of Law Relating to Bills of Lading (the Hague rules，海牙规则) The Paris Convention for the Protection of Industrial Property (Paris Convention， 巴黎公约 ) Understanding on the Rules and Procedures Governing the Settlement of Disp

7、utes (DSU，争端解决规则与程序谅解）III Sources of international business lawC International model lawDefinition: rules and norms worked out and passed by some international organizations for the free choice by nations.Examples:1. Model Law on International Commercial Arbitration by the United Nations Commission

8、on International Trade Law （联合国国际贸易法委员会国际商事仲裁示范法 UNCITRAL Model Law）2. Principles of International Commercial Contract by the International Institute for the Unification of Private Law （国际统一私法协会国际商事合同通则, UNIDROIT PICC ）III Sources of international business lawC International model lawNo certain lega

9、l validityInfluence: 1. model for national and international legislature; 2. a means of interpreting and supplementing existing uniform law; 3. rules governing the contract (situations?); 4. a substitute for the domestic lawIII Sources of international business lawD International trade customs and u

10、sagesDefinition: the general rules and practices in international trade activities that have become generally adopted through unvarying habit and common use. (used to be oral but later compiled into written rules)Examples:Warsaw-oxford Rules by the International Chamber of Commerce （华沙-牛津规则）The Inte

11、rnational Rules for the Interpretation of Trade Terms (INCORMS2010 国际贸易术语解释通则）The Uniformed Customs and Practice for Commercial Documentary Credits （UCP600 跟单信用证统一惯例）III Sources of international business lawD International trade customs and usagesInfluence: not law, but plays an important role.1. as

12、 binding rules by agreed upon by the parties to the contract.2. as interpreting or filling the gaps in the contract.(only for usages the parties agreed to be bound or that derive from their past dealings, or the usages the party knew or ought to have known and that are regularly observed in the indu

13、stry or trade involved.VI International OrganizationsA. Organization Affiliated with UN隶属联合国的隶属联合国的组织组织1. The United Nations Economic and Social Council 联合国经社理事会联合国经社理事会2. The United Nations Commission on International Trade Law (UNCITRAL) 联合国国际贸易法委员会联合国国际贸易法委员会Objectives: promote international trad

14、e through harmonization of trade law among nations.Most important achievements: the entry into force of CISG; Model Law on International Commercial Arbitration.VI International OrganizationsA. Organization Affiliated with UN3. International Monetary Fund (IMF) (Bretton Woods Conference) 国际货币基金组织国际货币

15、基金组织Objectives: to promote international monetary cooperation, to facilitate the expansion and balanced growth of international trade and to promote stability in foreign exchange.Voting rights of members: 250 basic voting right, plus voting rights calculated by their quota subscriptions (one voting

16、rights for every 10,000.00 SDR.) China with a voting rights of 2.54%.3.72%特别提款权（特别提款权（special drawingright,SDR) 国际货币基金组织创设的一种储备资产和记帐单位，亦称“纸黄金(Paper Gold)”。它是基金组织分配给会员国的一种使用资金的权利。会员国在发生国际收支逆差时，可用它向基金组织指定的其他会员国换取外汇，以偿付国际收支逆差或偿还基金组织的贷款，还可与黄金、自由兑换货币一样充当国际储备。但由于其只是一种记帐单位，不是真正货币，使用时必须先换成其他货币，不能直接用于贸易或非贸易的

17、支付。因为它是国际货币基金组织原有的普通提款权以外的一种补充，所以称为特别提款权。 VI International OrganizationsA. Organization Affiliated with UN4. “ World Bank” (two institutions) 世界银行世界银行 The International Bank for Reconstruction and Development 国际复兴开发银行（世界银行）国际复兴开发银行（世界银行）(loans at market terms, not high-risk loans)International Devel

18、opment Association 国际发展协会国际发展协会(loans to poor countries with average per capital GNP less than $ 410 on more favorable terms, but only to government)International Finance Corporation 国际金融公司国际金融公司( loans to private enterprises in developing countries)VI International OrganizationsB. other Internation

19、al Organizations1. GATT/WTO 关贸总协定与世界贸易组织关贸总协定与世界贸易组织(relation, aims, rounds of negotiation, principles, memberships?)2. The Organization for European Economic Cooperation 欧洲经济合作组织欧洲经济合作组织( foundation backgrounds, memberships, principles?)3. International Chamber of Commerce 国际商会国际商会 (purposes and co

20、ntribution to world trade?)V Comparison of Municipal Legal SystemA) Legal Families 法系法系1. the Romano-Germanic Civil Law Family 罗马日尔曼民罗马日尔曼民法法系法法系( the Roman law family, the continental law family, the civil law family): France, Germany, and Switzerland etc.2. the Anglo-American Law Family 英美法系英美法系 (

21、 the common law family, the case law family): England, America, India etc.3.Islamic Law Family 伊斯兰法系伊斯兰法系: Islamic countries.hybrids: elements of both the civil law and the common law.China?V Comparison of Municipal Legal SystemB) the differences between the two main legal family1.source of law 法源法源

22、: in the common law system, case law （判例法）as the primary source but also has a number of statutes; in the civil law system only statutes（制定法）.2. categories of laws 法律分类法律分类: public law and private law; common law and equity law.3. codification 法典化法典化: codification, generally no codification but sepa

23、rate laws.4. litigation modes 诉讼模式诉讼模式: authority mode（职权主义）; litigant mode（当事人主义）VI International Business Law and ChinaHow China came to accept international business law? A. When was the first time that China started to introduce international business law? B. What led to the incorporation of int

24、ernational business law principles and reasonable contents into Chinese business law? C. What created the best opportunity to China for the application of international business law?Chapter Two Forms of international BusinessI Some International Trade TheoriesA. Specialization 专业化专业化Specialization m

25、eans that each nation should specialize to its resource endowment by applying the law of comparative advantages. 专业化是指每一个国家都应该按照相对优势理论专门从事其有资源优势的行业。 It enables nations to emphasize the activities at which they are most efficient and at the same time gain certain advantages through trade.专业化能够使国家专门从事

26、其效率最高的行业并通过贸易专门从事其效率最高的行业并通过贸易获得利益。获得利益。I Some International Trade TheoriesA. Specialization China: textile, clothing, shoes, toys Brazil: coffee Why specialization: comparative advantage specialization (division of labor) trade increase the wealth of all nationsI Some International Trade TheoriesB.

27、 Absolute Advantage 绝对优势绝对优势 Adam Smith 亚当.斯密绝对优势理论（Theory of Absolute Advantage），又称绝对成本说绝对成本说（Theory of Absolute Cost）、地域分工说地域分工说（Theory of Territorial Division of Labor）。是指某两个国家之间生产某种产品的成本的绝对差异，即一个国家所耗费的成本绝对低于另一个国家。 Examples:I Some International Trade TheoriesC. Comparative Advantage 相对优势相对优势 coun

28、tries will specialize in producing several products and services in which they have lower opportunity costs than their trading partners . David Ricardo提出的贸易理论，该理论认为，国际贸易的基础是生产技术的相对差别（而非绝对差别），以及由此产生的相对成本的差别。每个国家都应根据“两利相权取其重，两弊相权取其轻”的原则，集中生产并出口其具有“比较优势”的产品，进口其具有“比较劣势”的产品。 P25 case: I Some Internationa

29、l Trade TheoriesD. opportunity Cost 机会成本机会成本 opportunity cost means the value of the benefit that is given up to produce one economic good as opposed to another. Economists measure the “real” cost of doing business by its opportunity cost, not by its direct cost. 机会成本：也叫“择一成本”或“择机代价”，是指利用某种资源生产某种商品时

30、所放弃的可以利用同一资源生产的其他商品的价值。 cases: p25-p26II ExportingA. Direct Exporting Terms: domestic buyer: prospective customer: full-time exporter manager: export marketing: foreign sales agents: distributorModes of exporting:Foreign sales agents who work on commissionSelling directly to foreign distributorsDiff

31、erences between the two?II ExportingB. Indirect Exporting1. through ETCs (export trading company)2. through EMCs (export management company)3. Situation in ChinaIII Government Controls over TradeA. Tariffs 关税关税1. definition: tariffs are taxes imposed on imports or exports when crossing the customs e

32、ither by value or per unit of quantity. a) ad valorem duty 从价税 b) specific duty从量税2. The significance of tariffs a) increase government revenue b) protect domestic industry c) political controlTariffTariff is accepted measures by WTO, but must follow the principle of deduction.At present, the averag

33、e tariff of industrial products for developed countries is about 3%, while developing countries 10%, and transitional countries 6%.III Government Controls over TradeB. Nontariff Barriers to Trade 非关税壁垒非关税壁垒1. definition: all barriers to import and export other than tariffs. Even greater and more ins

34、idious barrier than tariff.2. significance: to protect national economy, social and political interest.3.Types: technical barriers, environment barriers. often disguised in the form of government rules or regulations. Chinese moocake encounters American technical barriersChinese toys encounters tech

35、nical barriers中国显然希望利用北京奥运的机会强化中国主导的3G网络TD-CDMA在中国市场上的地位。不过，这令掌握着3G其他两个国际 标 准 WCDMA、CDMA2000的欧美国家及其厂商感到紧张。他们担心中国是在以此建立“技术壁垒”。Environment(green) barriersIII Government Controls over Trade absolute quota a) quota 配额 tariff quota quotas are not accepted measures as a lawful means of regulating trade ex

36、cept in some special cases. Quotas for cars imported2004年中国汽车及汽车配件的进口配额增加到104.9亿美元. 从2005年1月1日起，我国将取消汽车及其关键件的进口配额管理。 III Government Controls over Tradeb) embargo禁运: a total or near total ban on trade with a particular country, sometimes enforced by military action and usually imposed for political p

37、urposes. C) boycott 贸易抵制: a refusal to trade or do business with certain firms, usually from a particular country, on political or other grounds.4.influence of tariff and non-tariff barriers: P29 Pa2III Government Controls over TradeC. Export RestrictionsAn export restriction limits certain type of

38、product shipped to any particular country, which are usually imposed for economic or political purposes.High-tech computers might not be allowed to be shipped from the United States to another country without a license.Chinese government does not allow some valuable traditional Chinese medicines to

39、be exported.IV. International Licensing Agreement1. International Licensing Agreements: are contracts by which the holder of intellectual property right will grant certain rights in that property to a foreign firm under specified conditions and for a specified time. 国际许可协议是知识产权的持有人把部分权利授予外国公司在一定条件和一

40、定时间内使用的协议。A more important method than exporting to gain entry into foreign market.IV. International Licensing Agreement2. Intellectual property rights: are a grant from a government to an individual or firm of the exclusive legal right to use a copyright, paten or trademark for a specified time.知识产

41、权是一国政府授予个人或公司对版权、专知识产权是一国政府授予个人或公司对版权、专利或商标在一定时间内享有的专有权。利或商标在一定时间内享有的专有权。CopyrightsCopyrights are legal rights to an artistic or written work,(including books, software, films, music), or to a layout design of a computer chip.TrademarksTrademarks include the legal right to use a name or symbol that

42、identifies a firm or its product.PatentsPatents are governmental grants to inventors assuring them of the exclusive legal right to produce and sell their inventions for a period of years.Invention patentspatent for utility models Patent for industrial Designs IV. International Licensing Agreement3.

43、payment for International Licensing ContractA) lumpsum price 一次总付B) Royalty 提成 a) fixed royalty b) sliding royaltyC) initial price + royalty 入门费+提成IV. International Licensing Agreement4. Technology Transfer 技术转让技术转让a)definition: the exchange of technology and know-how (专有技术）专有技术）through arrangements

44、 such as international licensing contracts.b)Problems: government control, the gaps between the desire of the involved parties.IV. International Licensing Agreement5. International Franchising 国际特许国际特许 The most common form of franchising is known as a business operation franchise, usually used in re

45、tailing. Under a typical franchising, the franchisee is allowed to use a trade name or trademark in offering royalty based on a percentage of sales or other fee structure. 最常见的特许形式是在零售领域的商业方式的特许。最常见的特许形式是在零售领域的商业方式的特许。 典型的国际特许是被特许方支付销售额一定百分比的提成典型的国际特许是被特许方支付销售额一定百分比的提成费或其他费用方式而获得某个商号或商标的使用权费或其他费用方式而

46、获得某个商号或商标的使用权 Chapter three Legal System of International BusinessI. United Nations Convention on Contracts for International Sales of Goods (CISG)1. The Development of International Business LawA) Formation of customs for exchange of goods unwritten codes, known as Lex mercatoria or law merchant se

47、lf-ruled lawB) In England, by 18th century, law merchant became a part of the common law. C) Sales of Goods Act(England 1894) Uniform Sales Act ( USA 1906,no longer in effect) Uniform Commercial Code(USA 1951)D) Drafting of the CISG reason and purpose? Which organization drafted it ?2. Applicability

48、 of the CISGA) Applicability 适用范围适用范围a) for commercial sales of goods: not for consumer salesb) between parties whose places of business are in different countries (natioanality not considered)C) the places of business are in a contracting state, or applicable by rules of private international law 国

49、际司法规则导致适用（允许保留）How is the situation when a party has places of business in more than one country (multinational corporation)? principle of closest relationship ( to the contractplace of performance)2. Applicability of the CISGB) Sales and issue excluded 排除适用的销售排除适用的销售a) consumer goods sold for perso

50、nal, family or household use.b) goods bought at auctionc) stocks, securities, negotiable instruments, or moneyd) ships, vessels, or aircrafte) electricityf) assembly contractsg) contracts that are in preponderant part for the supply of labor or other servicesh) liability of the seller for death or p

51、ersonal injury caused by the goodsi) parties agree to exclude the Convention or they choose other law.2. Applicability of the CISGC. Issues not covered 没有涉及的问题没有涉及的问题 a) the legality of the contract (合同的效力） b) the competency of the parties（当事人的行为能力） c) the rights of third parties （第三方的权利） Do you kno

52、w the reason? Laws of different countries differ greatly on these issues, which might jeopardize the adoption of the CISG.3. Interpreting of the CISGA) The Convention 公约公约a) situation: the words itself require interpretationb) methods: the international character of the convention the need to promot

53、e uniformity in the conventions application; the observance of good faith (the plain meaning rule字面意思规则); Travaux preparatoire (preparatory work); legislative history?Case law?Case law?The need to promote uniformity in the conventions application compels courts to examine and follow the decisions of

54、 the courts in other contracting states. The requirement to use good faith means that courts must accept foreign decisions as precedents and depart from them only when they are clearly distinguishable, clearly erroneous, or no longer applicable to changed international circumstances.3. Interpreting

55、of the CISGB) General Principles 一般原则一般原则CISG calls for courts to look to the general principles on which the Convention is based, but gives no list of general principles. It does set out mechanism for determining them: they must be derived from particular sections within the Convention, and then ex

56、tended, by analogy, to the case at hand.Two principles suggested: a) the duty to communicate information needed by the other party; b) the obligation to mitigate damages resulting from a breach.3. Interpreting of the CISGC) Rules of Private International law 国际私法规则国际私法规则 Used only when CISG itself d

57、oes not directly settle a matter, or when the matter cannot be resolved by the application of a general principle derived from the Convention itself. private international law rules vary from country to country. Private international law codes Vs case law. Purpose: to avoid the possibility that cour

58、ts will adopt interpretive aids on an ad hoc basis.3. Interpreting of the CISGD) statements and Conduct of the Parties当事人的陈述和行为当事人的陈述和行为Approach to determine “meeting of minds” or “common intent”意思一致或合意: subjective intent approach 主观意思主义objective intent approach 客观意思主义.Oliver Wendell Holmes comment:

59、 “the law has nothing to do with the actual state of the parties minds. In contract, as elsewhere, it must go by the externals, and judge parties by their conduct.”CISG subjective intent first: if it can be fairly ascertained and the other party knew or could not have been unaware of the speakers in

60、tent. objective intent : when a speakers intent is not clear. A partys statement and other conduct are “to be interpreted according to the understanding that a reasonable person of the same kind as the other party would have had in the same circumstances.”3. Interpreting of the CISGE) Negotiations 谈

61、判谈判Article 8(3) of the CISG: When determine a partys intent, the following consideration should be taken into account:a) the negotiations leading up to the contractb) the practices which the parties have established between themselves.c) the parties conduct after they agree to the contract.Purpose:

62、to do away with the technical rules that domestic courts use to interpret contract.the parol evidence rule口头证据规则口头证据规则 the parol evidence rule forbids a court from considering any “prior” or “contemporaneous oral understanding” when it is interpreting a writing that the parties intended as a “final

63、expression of their agreement”SICGs attitude : If the parties choose to adopt the parol evidence rule, they can do so, however, unless they specifically do so, the court will look at all the relevant circumstances of the case.3. Interpreting of the CISGF) Practices and Usages 惯例惯例Art.8(3)and 9(1): a

64、ny practice they have established between themselves. (bound)Art.9(1): any usage which the parties agreed to. (bound)Art.9(2): a usage which the parties knew or ought to have known and which is widely known to and regularly observed. (let courts consider)II UNIDROIT PICCUNIDROIT : the International

65、Institute for the Unification of Private Law. 国际统一私法协会国际统一私法协会PICC: Principles of International Commercial Contracts. 国际商事合同通则国际商事合同通则The most important model laws of international commerce. 1. Scope of Application 适用范围适用范围The preamble states: “set forth general rules for international commercial co

66、ntract.”International : involving more than one states or regions.Commercial contracts: (be understood in the broadest possible way) include not only trade transactions for the supply or exchange of goods or serves, but also other types of economic transactions, such as investment and/or concession

67、agreements, contracts for professional services. 2. General PrinciplesA) Freedom of Contract 合同自由合同自由Art.1 (1) reads: “the parties are free to enter a contract and to determine its contents.”a) the possibility of concluding contracts with any other person, irrespective of their legal status and thei

68、r nationality.b) the freedom of the parties to determine the content of their contract.c) the right to exclude UNIDROIT PICC in whole or in part or modify their content.2. General PrinciplesB) Openness to Usages 对惯例的开放态度对惯例的开放态度a) parties are bound by any usage to which they have agreed and any prac

69、tice which they have established between themselves.b) also by a usage that is widely known to and regularly observed in international trade by parties in the particular trade concerned, except where the application of such a usage would be unreasonable.2. General PrinciplesC) Favor Contractus 有利于合同

70、成立有利于合同成立the aim : preserving the contract whenever possible, thus limiting the number of cases in which its existence or validity may be questioned or in which it may be terminated before time.Eg: a contract may be concluded either by the acceptance of an offer or by conduct of the parties that is

71、sufficient to show agreement.Eg: about “modified acceptance” : if the additional or different terms do not materially alter the terms of the offer and the offeror does not object to the discrepancy without undue delay, the contract exists.2. General PrinciplesD) Observance of Good Faith and Fair Dea

72、ling遵守诚实信用及公平交易原则遵守诚实信用及公平交易原则No definition, referred elsewhere to as “reasonable commercial standards of fair dealing, and not in a subjective sense, as a state of mind or just acting honestly.”a) duty of confidentiality 保密义务b) negotiation in bad faith 恶意磋商: a party enters into or continues negotia

73、tions when intending not to reach an agreement with the other party.2. General PrinciplesD) Observance of Good Faith and Fair Dealing遵守诚实信用及公平交易原则遵守诚实信用及公平交易原则negotiation in bad faith, one of the causes of precontractual liability(先合同义务）先合同义务）, a well-known principle in civil law systems, aims at re

74、conciling freedom of negotiation with the principle of good faith; while the common law systems are reluctant to restrict the freedom of negotiation and favour a view of negotiations according to which parties are at risk until contract is formed. But still precontractual liability may be based on u

75、njust enrichment, misrepresentation or specific promise etc.2. General Principlesc) interpreting the intent of the parties: “according to the meaning that reasonable persons of the same kind as the parties would give to it in the same circumstances.”d) force majeure不可抗力不可抗力: which excludes a partys

76、liability for its non-performance due to an impediment beyond that partys control and that it could not reasonably be expected to have taken the impediment into account at the time of the conclusion of the contract or to have avoided or overcome it or its consequences.3. The Purpose of the UNIDROIT

77、PICC Persuasive value, the role to play in the following contexts:a)A Model for Nation and International Legislatorsb)A Means of Interpreting and supplementing Existing International Instrumentsc)A Guide for Drafting Contractsd)As Rules Governing the Contracts the parties themselves agreed to; to a

78、certain extent, some courts refer it as rules of law governing the contract.4.Comparison of the UNIDROIT and CISGA) the Importance of CISGThe CISG was unanimously adopted in 1980 by a diplomatic conference held in Vienna with participation of representatives from 62 states and 8 international organi

79、zations, it represents a landmark in the process of international unification of law. The importance is further demonstrated by the fact that the number of decisions rendered by both state courts and arbitral tribunals in its applications is rapidly increasing.4.Comparison of the UNIDROIT and CISGB)

80、 the Shortcomings of CISGa) CISG is less comprehensive in contents. Eg: the scope of applications; issues excluded; stress on the principle of good faith. (p58)b) some provisions in UNIDROIT are more reasonable and suitable. Eg: attitude toward usage; c) the trade-encouraging principle is better emb

81、odied in UNIDROIT. (about the modified acceptance:p59 )4.Comparison of the UNIDROIT and CISGC) UNIDROIT as a Means of Interpreting and Supplementing SICGSome important concept in CISG is defined in a rather cryptic manner, eg: article 25PICC may provide further factors to determine the criteria laid

82、 down by the CISG, eg: article 7.3.1III. International Rules for the interpretation of Trade Terms (Incoterms 2000)1. concept and Role of Trade TermsIn order to save time and reduce trade costs, merchants use trade terms as a shorthand to fix their rights and obligations. Trade terms are usually exp

83、ressed in the form of abbreviated symbols, such as FOB or CIF, from which we can see the formation of cost of the goods, place of delivery and allocating of risks etc.2. Incoterms 2000A) What is incoterms ?Incoterms is a set of trade term definition published by the International Chamber of Commerce

84、 (ICC), which provides rules to determine the obligations of both seller and buyer. First published in 1936,the newest revision is in 2000.B) what is the nature of incoterms ?ICC-Non-governmental entity, incoterms not national legislation or international treaty, no binding force. It is a written fo

85、rm of custom and usage, which may apply to a contract of international sales of goods only if the parties have incorporated them into the contract.2. Incoterms 2000C) Contents of incoterms 200013 trade terms classified into 4 groups.a) E Group (the seller assumes the least obligations)EXW: Ex Works

86、工厂交货工厂交货Seller: make contracted goods available at its factory ( farm, warehouse etc.)Buyer: bear all risks and expenses of the journey from that point, including clearing the goods for export.C) Contents of incoterms 2000b) F Group (main carriage unpaid)FCA: free carrier 货交承运人货交承运人FAS: free alongsi

87、de ship 装运港船边交货装运港船边交货FOB: free on board 装运港船上交货装运港船上交货Similarity: the seller places the goods in the hands of a carrier named by the buyer at a time and place stipulated by the contract, and the risk of loss also passes to the buyer at the time and place.Differences?C) Contents of incoterms 2000c)

88、c group (main carriage paid) CFR: cost and freight 成本加运费成本加运费 CIF: cost, insurance and freight 成本、运费加保险费成本、运费加保险费 CPT: carriage paid to 运费付至运费付至 CIP: carriage and insurance paid to 运费、保险费付至运费、保险费付至1) shipment contact2) passing of risks: ships rail or receipt of goods by carrier.3) dividing line of f

89、ees and risks is inconsistent.4)modes of transportation: CFR/CIF- ocean CPT/CIP-all modesC) Contents of incoterms 2000d) D group (arrival contract)DAF: delivered at frontier 边境交货边境交货DES: delivered ex ship 目的港船上交货目的港船上交货DEQ: delivered ex quay 目的港码头交货目的港码头交货DDU: delivered duty unpaid 未完税交货未完税交货DDP: de

90、livered duty paid 完税后交货完税后交货1) destination(arrival) contract2) under DDP, seller should clear goods for import.3) DES and DEQ for ocean transportation, the rest for all modes .The author says destination contract are becoming increasingly popular, why?D. FOBa) the term is followed by the port of shi

91、pment. Eg: FOB Shanghaib) place of delivery: on board the ship named by buyer at the contracted port of shipment.c) passing of risks: ships raild) specific obligations for each party (p64)e) loading expense: FOB liner terms, FOB stowed, FOB trimmed, FOB stowed and trimmedf) other issues: class of ca

92、rrying ship, arrival time of carrying ship (demurrage?), additional serviceE. CIFa) the term is followed by the port of destination. Eg: CIF New York. b) Still shipment contract.c) place of delivery: on board the ship named by seller at the contracted port of shipment. Symbolic deliveryd) passing of

93、 risks: ships rail at shipment port.E. CIFe) expenses: carriage and insurance to destination.f) specific obligation for each party(p67)g) unloading expense: CIF liner terms, CIF landed, CIF ex tackle, CIF ex ships holdh) other issues: insurance premiem-110%invoice value at FPA terms; type, class and

94、 nationality of vessel.F. Modification of trade termsa) modification is allowedb) often use for CIF terms to prevent trade frauds.c) ask for legal adviceCase AnalysisKumar 700 TV Nava on CIF termsAddition: Nava would not pay until sold the goodsDuring transportation goods stolenKumar sue carrierCarr

95、ier agrue no standing to sueTrial court decision: support the defendantKumar appealsDecision of the appallete court: support the plaintiffChapter Four Contract law for the International Sale of GoodsI Definition and Form of Contract1. Definition of ContractA) English Law: “A promise or a set of prom

96、ises, for breach of which the law gives a remedy, or the performance of which the law in some way recognizes as a duty.”B) American Law: “A promise or a set of promises that the law will enforce or at least recognize in some way.”I Definition and Form of Contract1. Definition of ContractC) French Ci

97、vil Code1101: “ Contract is a mutual assent with which one person or more is obligated to give a thing, to do or not to do a thing to one person or more persons.”D) China Contract Law: “A contract is an agreement establishing, modifying and terminating the civil rights and obligations between natura

98、l persons, legal persons or other organizations.”2. Form of ContractA) English Law: early period required that contract be in writing. 1906 revised Sales of Goods Act repealed the writing requirement.B) American Law: UCC requires that contracts for sale of goods for $500 or that more must in writing

99、. However, at present many exceptions to this rule make most oral sales of contracts enforceable.C) CISG: “A contract of sale need not be concluded in or evidenced by writing and is not subject to any other requirements as to form. It may be proved by any means, including witnesses.”2. Form of Contr

100、actD) UNIDROID PICC: almost the same with CISGE) China Contract Law article 10: “The parties may, when making a contract, use written form, verbal form or any other form.” “The written form shall be adopted if laws or administrative regulations so require. The written form shall be adopted if the pa

101、rties so agree.”II Validity and Formation of Contract1. Essential elements of a valid contractA) the common law: a) an agreement between parties enter into by their mutual assent (offer and acceptance).b) legally sufficient consideration （对价）（对价）c) legal capacityd) not for illegal purpose, not illeg

102、al activity and not contrary to public policy.1.Essential elements of a valid contract B) the civil law similar to the common law except for the legally sufficient consideration. C) CISG only governing the formation of a contract and the rights and obligations of the parties, other issues are left t

103、o national laws. D) China law similar to the civil law2. Offer 要约要约A) the concept of offerAn offer is a proposal by one person to another indicating an intention to enter into a contract under specified terms.The Second Restatement of Contracts: “ an offer is a manifestation of willingness to enter

104、into a bargain, so made as to justify another person in understanding that his assent to that bargain is invited and will conclude it.”B) Requirements of Offera) an offer must be addressed to one or more specific persons.Different attitude of laws toward advertisement:b) an offer must be sufficientl

105、y definite and indicates the intention of the offeror to be bound.Definiteness: description of goods, expressly or implicitly specifies the quantity and price etc.c) an offer becomes valid when it arrives at the offeree（受要约人）（受要约人）.C) The binding of an OfferAn offer isnt binding on the offeree, whet

106、her or not binding on the offeror is rather complex.a) the common law: Isnt binding ( lack of consideration)doesnt meet the development of modern economic life, so UCC improved this and holds that: “an offer cant be revoked if (a) the offeror is merchant (b) it has a period of validity (c) the offer

107、 must be in writing and the offeror must sign on it.”C) The binding of an Offerb) the German law: binding on the offeror.c) the French law: the offeror can revoke the offer before the acceptance of the offeree.d) CISGAn offer may be revoked if the revocation reaches the offeree before he has dispatc

108、hed an acceptance;An offer cant be revoked (a) if it indicates that it is irrevocable or (b)if it was reasonable for the offeree to rely on the offer as being irrevocable and the offeree has acted in reliance on the offer.D) Lapse of Offer要约的失效要约的失效a) On the death either of the offeror or the offere

109、e before acceptance.b) By non-acceptance within the time prescribed for acceptance by the offeror.c) when no time for acceptance is prescribed, by non-acceptance within a reasonable time. (how to decide reasonable time?)F. Revocation of offer要约的撤销要约的撤销a) conceptthe offeror notifies the offeree of th

110、e invalidity of the offer so as to be free from it before acceptance of the offeree.b) English law an offer may be revoked at any time before acceptance, but revocation does not take effect until it is communicated to the offeree.c) UCCas between merchants, an offer may not be revoked if it is made

111、in a signed writing or it fixes a valid period.F. Revocation of offerd) civil lawGo even further in limiting the offerors power to revoke during the period of time normally needed for the offerees acceptance to arrive.e) CISGAn offer may be revoked if the revocation reaches the offeree before he has

112、 dispatched an acceptance;An offer cant be revoked (a) if it indicates that it is irrevocable or (b)if it was reasonable for the offeree to rely on the offer as being irrevocable and the offeree has acted in reliance on the offer.3. AcceptanceA) ConceptThe acceptance is the offerees manifestation of

113、 the intention to be bound to the terms of the offer.A contract isnt formed until the offer is accepted by the offeree.The offeree may accept at any time before the offer is invalid.An acceptance may take the form of a statement or any other conduct that indicates the offerees intention to be bound

114、to the contract.B) Requirements of Acceptancea) must be made by the offeree.A offer B C Ab) Must be made within the period of validity. (How should we deal with a late acceptance?)c) Must match the terms of the offer exactly and unequivocally. (What is the nature of an acceptance which do not match

115、the offer exactly?)C) Valid Time of Acceptancea) Mail-box RuleUnder the common law, a contract is formed when acceptance is dispatch by the offeree.b) Receipt TheoryUnder most civil law, a contract is formed when the acceptance is received by the offeror.c) CISG, UNIDROIT PICC and China Contract Law

116、 also adopt the receipt theory.4. Battle of the Forms格式之争格式之争The Mirror Image Rule 镜像原则镜像原则The mirror image rule requires that an acceptance be unconditional and that it not attempt to change any of the terms proposed in the offer. ( Acceptance matches the offer exactly)Criticism to the Mirror Image

117、 RuleInflexible, cant meet the need of the trade-encouraging principle.4. Battle of the FormsA) UCCUCC states that, between merchants, an acceptance by confirmation that contains additional terms that reflect only minor changes from the buyers order will be effective to produce a contract, and the m

118、inor terms become a part of the contract unless the buyer notifies the seller of an objection to the new term.A material term( new term in the acceptance that attempt to materially alter the offer) do not become a part of the contract unless accepted by the other party.4. Battle of the FormsB) the C

119、ISGAn acceptance containing new terms that do not materially alter the terms of the offer becomes a part of the contract, unless the offeror promptly objects to the change. An acceptance that contains additional or different terms that do materially alter the terms of the offer would constitute a re

120、jection of the offer and a counter-offer. Elements accounts for a material change: price, payment, quality and quantity of goods, place and time of delivery, extent of one partys liability to the other, and settlement of disputes.4. Battle of the FormsC) UNIDROID PICCA reply to an offer which purpor

121、ts to be an acceptance but contains additions, limitations or other modifications is a rejection of the offer and constitutes a counter-offer.A reply to an offer which purports to be an acceptance but contains additional or different terms which do not materially alter the terms of the offer constit

122、utes an acceptance, unless the offeror objects to the discrepancy without undue delay.D) China Contract Law: almost the same with CISG5. Consideration in Common LawA) DefinitionConsideration is some benefit received by a party who gives a promise or performs an act, or some detriment suffered by a p

123、arty who receives a promise. (the price you pay to buy another persons promise) P92Under common law, it is one of the three elements of contract formation.Case AnalysisWilliam story promised $5000 his nephew if he does not drink, smoke or gamble until 21 years of age.The nephew perform his promise b

124、ut the uncle died without any payingThe nephew sold his interests HammerHammer sued william storys estateTrial court supported plaintiffAppeal court reversed the decisionHammer appeal highest courtIssue: was the contract invalid for lack of considerationDecision: the nephew abandoned some of his leg

125、al rights constitutes sufficient consideration to the promised payment. Not considering whether the performance is of the promisees benefit.5. Consideration in Common LawB) General Rules on Considerationa) is required for all simple contract( not under seal).b) must have a value recognized by law bu

126、t need not be equal to the promise.c) must be present or future and cannot be past. P95d) must be possible to perform.e) must be legalf) must move from the promisee (privity of contract)h) must not be too vague (moral obligation isnt consideration p95 )5. Consideration in Common LawC) Exceptions to

127、the Consideration Requirementa) contract under seal 密封的合同密封的合同b) promissory estoppel 禁止反言禁止反言This theory aims to balance the unfairness caused by the consideration theory. It holds that a contract exists even though the lack of consideration if the promisee makes performance that is relied on the pr

128、omise.5. Consideration in Common LawD) Reform on ConsiderationReason: criticized for lack of fairness.England: 1937 the English Law Revision Committee recommended the enactment of a statute making a signed written promise enforceable without regard to consideration but has not been followed.The US:

129、some states moves some steps forward ( Pennsylvania, New York)Little material reform has taken place in the last 200 years.Case analysisLouis Gail Fiege promise to pay medical and miscellaneous expenses Louise Boehm if she does not sue him for bastardy.Louis Gail Fiege refused to perform when findin

130、g he was not the father of the childLouise Boehm sued for performance Issue : was the contract valid?Decision: forbearance to sue is sufficient consideration for a promise to pay for the forbearance if the forbearing party had an honest intention to prosecute litigation which he believed to be well

131、founded.III Misrepresentation 错误陈述错误陈述1. concept: the basic idea of misrepresentation is that one party makes false statement and the other party thus enters into a contract by jusitifiably relied on it. 2. Elements: misrepresentation of a material fact and the harmed party justifiably relied on the

132、 statement.A material fact is one that would contribute to a reasonable persons decision to enter the contract.P100 Pa.3III MisrepresentationA. fraudulent Misrepresentation欺诈性错误陈述欺诈性错误陈述1.the representor made a false statement2.the representor knew the statement was false, or was recklessly indiffer

133、ent about its truthfulness.3.the representor intended that the statement would persuade the other party to enter the contract.4.the innocent party relied wholly or partly on the statement.5.the innocent party suffered loss as a result of the false representation.Remedies: damagesIII Misrepresentatio

134、nB. Innocent Misrepresentation无意的错误陈述无意的错误陈述1. the representor did not know the statement was false and was not recklessly indifferent about its truthfulness2. there is no need to prove that damages resulted.Remedy: avoidance of the contractP101III MisrepresentationC. Negligent Misrepresentation 过失的

135、错误陈述过失的错误陈述1. the representor makes a false statement innocently but carelessly;2. the other party reasonably relies on and suffers a loss.Remedies: damagesIV. Mistakes 误解误解A) Common LawMistakes under common law mean a misunderstanding between parties about a fact to the contract.If it could be clas

136、sified as a mistake regarding a material fact, the contract is usually void ab initio. That is, the law considers that the contract never took place and the parties should be restored to their original position.a) common mistake 共同误解 P102b) mutual mistake 双方误解 P103 Pa.1c) unilateral mistake 单方误解IV.

137、MistakesB) Civil LawFrench Civil Code 1110(1): “Error relating to the nature of contracted object amounts to the cause for an invalid contract.” What does the nature of contracted object refer?German Civil Code 119: “(1) a party may revoke his expression if ha has made error relating to the content,

138、 or he would not have made this expression at all if he had reasonably known the facts. (2) an error about the nature of a person or a thing, confined to only substantiality in transaction, is regarded as error about content.”IV. Mistakesc) The UNIDROID PICC(1)A party may only avoid the contract for

139、 mistake if the mistake was of such importance that a reasonable person in the same situation as the party in error would only have concluded the contract on materially different terms or would not have concluded it at all if the true state of affairs had been known.(2)A party may not avoid the cont

140、ract ifHe was grossly negligent in committing the mistakeThe mistake relates to a matter in regard to which the risk of mistake was assumed or, having regard to the circumstances, should be borne by the mistaken party.IV. Mistakesd) China Contract LawArticle 54: “A party shall have the right to requ

141、est the peoples court or an arbitration institution to modify or revoke the following contract:(1)those concluded as a result of serious misunderstanding ; 重大误解的合同重大误解的合同 (the nature of contract; the other party; the quality and assortment of the contracted object; price and expenses.)(2)those that

142、are obviously unfair at the time when concluding the contract.” 显失公平的合同显失公平的合同 (materially unfair to one party due to urgency or lack of experience)V. Fraud 欺诈欺诈A)Common lawThe legal term is scienter.To prove fraud, one must prove the other party:(1)Knowingly made witha)Know exactly that his states

143、was falseb)Know that he did not have a basis for the statement.c)Without being confident that his statement was true.(2)Intent to deceive: can be inferred from the fact that the defendant knowingly made a misstatement of fact to a person who was likely to rely on it. P106 pa.2 case 4-4Remedies: resc

144、ind the contract or affirming the contract and suing in tort for damages resulting from the fraud.V. FraudB) Civil LawFrench Civil Code 1116: “if one party commits fraud, the other party would not have concluded the contract without this fraud, this fraud constitutes the cause of void contract.”Germ

145、an Civil Code 123: “A person was induced to have made expressed intention by fraud, and he has right to rescind this intention.”V. FraudC) UNIDROIT PICCA party may avoid the contract when it has been led to conclude the contract by the other partys fraudulent representation, including language or pr

146、actices, or fraudulent non-disclosure of circumstances which, according to reasonable commercial standards of fair dealing, the latter party should have disclosed.”V. FraudD) China Contract LawArticle 54: “If a contract is concluded by one party against the other partys true intentions through the u

147、se of fraud, coersion or exploitation of the other partys unfavorable position, the injured party shall have the right to request the peoples court or an arbitration institution to modify or revoke it.”Article 42:b) concealing deliberately the important facts relating to the conclusion of the contra

148、ct or providing deliberately false information.c) performing other acts which violate the principle of good faith.VI. Duress 胁迫胁迫A) Common Lawa) concept: duress is wrongful coercion that induces a person to enter or modify a contract.(1) physical compulsion(2) threat of physical, emotional or econom

149、ic harmb) elements to be established:(1) the contract was induced by an improper threat(2) the victim had no reasonable alternative but to enter the contract.c) remedy: void contract or voidable at the option of the victimOnus of proof:VI. DuressB) Civil LawFrench Civil Code 1111: “Coercion by one p

150、arty, even though by a third party acting for his interest, to the other party who undertakes duty after the conclusion of a contract constitutes cause for void contract.”1112: “An act constitutes coercion if it is serious enough to create an impression to a normal person who worries that his body o

151、r property faces material and imminent injury.”B) Civil LawB) Civil LawGerman Civil Code 123 : “ A person was coerced to have expressed his intention by unlawful threat is entitled to rescind his expression.”VI. DuressC) UNDROID PICC“ A party may avoid the contract when it has been led to conclude t

152、he contract by the other partys unjustified threat which, having regard to the circumstances, is so imminent and serious as to leave the first party no reasonable alternative.”(1) how to understand “imminent and serious” ?(2) how to decide “unjustified threat” ?VI. DuressChina Contract lawArticle 54

153、 (mentioned before)Concept: Coercion (duress) refers to an act that causes fear to the other party which forces him to have made untrue intention.Elements to be established: (1) the person has really committed duress; (2)the person has intent of duress, hoping the other person to make untrue intenti

154、ons; (3) the coerced person has really made untrue intentions due to the duress.Remedy: ? To modify or revoke the contract.VII. Undue Influence and Unconscionable ConductA) Common Lawa) concept of undue influence: a party uses a position of influence to persuade the other party to enter a contract t

155、hat provides the stronger party with a direct or indirect benefit.b) purpose of undue influence: to protect the old, the timid, and the physically or mentally weak from those who gain their confidence and attempt to take advantage of them.A) Common Lawc) types of undue influence1) the defendant occu

156、pied a legally recognized position of authority of influence ( once the special relation is proven, the court presumes there was no genuine consent. The defendant can overcome this presumption by proving the plaintiff understood the contract and entered it voluntarily.) special relationships: (1) pa

157、rent and child; (2) trustee and beneficiary; (3) doctor and patient; (4) solicitor and client; (5) guardian and ward; (6) religious adviser and devoteec) types of undue influence2) the defendant did not occupy a legally recognized position of authority of influence : the plaintiff must satisfy the o

158、nus of proof (举证责任）by showing that he or she was dominated by the defendant and did not understand the contract.Different burden of proof between the two typesA) Common Lawd) unconscionable conduct （不公平行为）（不公平行为）A contract may be avoidable on the grounds of unconscionable conduct. But the plaintiff

159、must prove that:1) their disability made them the weaker party in contract negotiations. Disability includes: illiteracy, limited education, illness, poverty, age-related problems and lack of access to legal advice.2) the stronger party took advantage of this disability;3) this prevented them from m

160、aking an independent decision about the contract.Cases AnalysisMr. And Mrs. Amadios son loan contract commercial Bank of AustraliaMr. And Mrs. Amadio guaranteed the bankThe sons business failed and can not payThe bank sued parents to payIssue: was the bank engaged in unconscionable conduct?Decision:

161、 yes, the guarantee contract voidable.Reason: poor understanding of written English, no business experience. The bank did not advise them to ask legal advise.Civil Law and UNDROIT PICCB) Civil Law Stipulations in the civil law are similar to that of the UNIDROIT PICCC) UNDROIT PICCThe term for uncon

162、scionable conduct in UNDROIT PICC is gross disparity(严重不公）严重不公）. Article 3.10:1) A party may avoid the contract or an individual term of it if, at the time of the conclusion of the contract, the contract or term unjustifiably gave the other party an excessive advantage.C) UNDROIT PICC2) Upon the req

163、uest of the party entitled to avoidance, a court may adapt the contract or term in order to make it accord with reasonable commercial standards of fair dealing.3) a court may also adapt the contract or term upon the request of the party receiving notice of avoidance, provided that that party informs

164、 the other party of its request promptly after receiving such notice and before the other party has acted reliance on it.D) China LawArticle 54 (2): “Where a party makes the other party enter into a contract against its true will by means of deceit, coercion or taking advantage of its difficulties,

165、the injured party has the right to request the peoples court or an arbitration institution to alter or rescind the contract.”Article 39: when standard term applied, the obligation of the party which supplies the standard terms to request the other party to note the exclusion or restriction of its li

166、abilities,D) China Lawand to explain the standard terms according to requirement of the other partyArticle 40: when the party providing standard terms exempts itself from its liabilities, weights the liabilities of the other party, and excludes the rights of the other party, the terms shall be null

167、and void（无效）（无效）.Chapter Five Contract Law for the International Sale of GoodsI Remedies for Breach of ContractA) Concept of breach of contractA party without lawful excuse fails or refuses to perform what is due from him under the contract, or performs defectively or incapacitates himself from perf

168、orming.The objective of remedies: to put the injured person in the same position as if the contract has been performed.I Remedies for Breach of ContractB) General principles of Remediesa) The doctrine of compensation 补偿原则补偿原则1) the doctrine of expectation interest（预期利益）（预期利益）: the injured party is e

169、ntitled to his expectation interest lost by the party in breach. (be in as good position as that party would have been in had the contract been performed)Expectation interest: benefit of the bargain. Eg: the difference between the market price and the contract price at the date of the breach.a) The

170、doctrine of compensation2) the doctrine of reliance interest （信赖利益）（信赖利益）The defendant promised to perform his contractual obligations, the claimant has acted to his detriment in entering into the contract and the award of damages should compensate the claimant.Objective: to put the claimant in as g

171、ood a position as he was in before the defendants promise was madea) The doctrine of compensation3) the doctrine of restitution interest 归还利益归还利益A claimant claiming the protection of his restitution interest does not wish to be compensated for the loss which he has suffered, he wishes to deprive the

172、 defendant of a gain which he has made at the claimants expanse.Comparison between expectation interest, reliance interest and restitution interest.( eg: p123)ComparisonSellers obligation: supply a computer for $2000Sellers performance: supply a computer for $1000Buyers Market value for the computer

173、:$2500expectation interest?reliance interest?restitution interest?b) The Doctrine of Limitations on Damages1) Non-breaching party has the duty to mitigated damages; (the enlarged damages are not compensated)2) Damages must be established with a reasonable degree of certainty; (may not be awarded on

174、a purely speculative basis. eg:p124)3) Damages must be either foreseeable to the breaching party or would naturally flow from the breach. (p124)Case 5-1 Prutch v. Ford Motor CompanyPrutches purchased tractor,plow Baldridge Implement Company (produced by Ford Motor Company)After crop damages Prutch s

175、ue seller and producerTrial court support the plaintiffThe appellate court overturned the verdictThe denfendant appeal to the higest court Issue: Can the manufacturer be expected to foresee the defects of its productsThe denfendants argument:Decision: yes Reasoning:C) Buyers RemediesSellers usual br

176、each: 1) failing to make delivery; 2) non-conformity; 3) indicating an intention not to fulfill the obligationBuyers remedies:1) specific performance2) avoidance of the contract ( for fundamental breach)3) to reduce price (for non-conformity)4) to refuse early delivery5) to refuse excess quantitiesC

177、) Buyers Remediesa) specific performance 实际履行实际履行1) common law and civil lawcivil law: specific performance is the usual remedycommon law: the usual remedy is damages. Specific performance is considered a harsh remedy to be used only where money damages cannot be calculated or are inadequate, eg: th

178、e subject matter of the contract is unique. (artist work, real estate etc.)a) specific performance2) The SICGThe CISG draws strongly on the civil laws acceptance of specific performances as a remedy in contract cases.Conditions needed to be satisfied: the buyer has not resorted to other remedies; th

179、e seller had failed to deliver, or serious nonconformity that constitutes a fundamental breach; timely notice to seller that the goods were nonconforming; timely request that the seller provide substitute goods.a) specific performance3) the UNIDROIT PICCPermitting specific performance, but with exce

180、ptions: performance is impossible in law or in fact; performance or enforcement is unreasonably burdensome or expensive; the party entitled to performance may reasonably obtain performance from other source; performance is of an exclusively personal character; the party entitled to performance does

181、not require performance within a reasonable time after it has become aware of the non-performance.a) specific performance4) China Contract LawArticle 110: if one party to a contract fail s to perform the non-monetary debt or its performance of non-monetary debt fails to satisfy the terms of the cont

182、ract, the other party may request it to perform except under any of the following circumstances: (1) it is unable to be performed in law or in fact; (2) the object of the debt is unfit for compulsory performance or the performance expenses are excessively high; or (3) the creditor fails to request f

183、or performance within a reasonable time period.b) Avoidance 合同无效合同无效1)common law and civil lawIf the breach is material or fundamental, the buyer may simply cancel the contract by notifying the seller of avoidance of the contract, take care that the goods are temporarily protected and preserved and

184、ask for a full refund.When the goods may rapidly deteriorate or decay, the buyer can notify the seller and then take steps to sell them.b) Avoidance2)the CISGA buyer may avoid a contract if either (a) the seller commits a fundamental breach or (b) the buyer gives the seller a Nachfrist（宽限期）（宽限期） not

185、ice and the seller rejects it or does not perform within the period it specifies.b) Avoidance3) the UNIDROIT PICCA party may terminate the contract where the failure of the other party to perform an obligation amounts to fundamental non-performance. non-performance deprives the aggrieved party of wh

186、at was entitled to expect under the contract. non-performance is of essence under the contract. non-performance is intentional or reckless. non-performance gives the aggrieved party reason to believe that it cannot rely on the other partys future performance.b) Avoidance4) China contract lawArticle

187、94: “ The parties to a contract may rescind the contract under any of the following circumstances:(1) the purpose of the contract cannot be attained because of force majure;(2) before the period of performance expires, either party clearly indicates by word or by act that it will not perform the pri

188、ncipal debts;4) China contract law(3)either party delays the performance of the principal debts and still fails to perform them within a reasonable period of time after being urged;(4) either party delays the performance of debts or commits other acts in breach of the contract so that the purpose of

189、 the contract is not able to be realized;c) Price ReductionPrice reduction is applied when(1) the seller makes only a partial shipment;(2) the goods are nonconforming The amount of reduction is often within the discretion of the buyer. If the seller disputes the buyers calculation, he can resort to

190、legal action.d) Refuse Early Delivery and Excess QuantityIf the seller delivers the goods before the date fixed, the buyer may take delivery or refuse to take delivery.If the seller delivers a quantity of goods greater than that provided for in the contract, the buyer may take delivery or refuse to

191、take delivery of the excess quantity. If the buyer takes delivery of all or part of the excess quantity, he must pay for it at the contract price unless otherwise stipulated in the contract.D) Sellers Remedies1) specific performance2) avoidance of the contract ( for fundamental breach or failure to

192、cure a defect)3) obtain missing specificationsE) Remedies Available to Both Buyers and Sellers1) suspension of performance2) avoidance in anticipation of a fundamental breach 3) avoidance of an installment contract4) avoidance5) damagesDamagesCISG provides: “Damages for breach of contract by one par

193、ty consist of a sum equal to the loss, including loss of profit suffered by the other party as a consequence of the breach. Such damages may not exceed the loss which the party in breach foresaw or ought to have foreseen at the time of the conclusion of the contract.DamagesThe method of measuring mo

194、ney damages: The buyer may claim damages if the substitute goods cost more than contract price; if the buyer has not purchased substitute goods, damages are measured by the difference between the contract price and current market price.DamagesUNIDROIT PICC1) applied either exclusively or in conjunct

195、ion with any other remedy2)compensated harm includes both any loss which it suffered and any gain of which it was deprived3) the harm may be non-pecuniary and includes physical suffering or emotional distress.DamagesUNIDROIT PICCCompensation limited:1) harm with a reasonable degree of certainty2) be

196、 due for the loss of a chance in proportion to the probability of its occurrence3) when damages cannot be established with a sufficient degree of certainty, the assessment is at the discretion of the court.DamagesChina Contract LawArticle 113: the amount of compensation for losses shall be equal to

197、the losses caused by the breach of contract, including the interests receivable after the performance of the contract provided not exceeding the probable losses caused by the breach of contract which has been foreseen or ought to be foreseen when the party in breach concludes the contract.Article 11

198、9: the innocent party has the duty to take proper measure to prevent from the enlargement of losses; otherwise, the party may not claim any compensation as to the enlarged losses.Avoidance of Installment Contract1) if fundamental breach occurs to a particular installment, then the other party may de

199、clare the contract avoided with respect to that installment.2) if the breach of one installment gives a party good grounds to believe that a fundamental breach of later installments will occur, then those later installments may be anticipatorily avoided.3) if the installments are interdependent, a f

200、undamental breach of one installment will allow a party to avoid the entire contract.II Anticipatory Breach of Contract and Exceptio non Adimpleti Contractus in Civil LawA) Anticipatory Breach 预期违约预期违约1) concept: one contracting party may inform the other party, before the time fixed for performance

201、 under the contract, that he will not perform his obligations under contract.2) remedy: the other party thus entitled to terminate performance immediately and claim damages at the date of the acceptance of the breach. He can also select to affirm the contract and demand performance at the time stipu

202、lated in the contract.B) Exceptio non Adimpleti Contractus 不安抗辩权不安抗辩权1) concept: one party is entitled to reject performance unless the other party performs his obligations according to the contract.2) German Civil Code: if one party to a bilateral contract is obligated to give first, he may reject

203、his obligation in the case where the other partys property becomes so obviously less that his right is injured, and before the other party provides guarantee.B) Exceptio non Adimpleti Contractus 3) the UNIDROIT PICC7.1.3: (1)同时履行抗辩权；同时履行抗辩权； （2）先履行抗辩权）先履行抗辩权7.3.4:不安抗辩权不安抗辩权A party who reasonably bel

204、ieves that there will be a fundamental nonperformance by the other party may demand adequate assurance of due performance and may meanwhile withhold its own performance. Where this assurance is not provided within a reasonable time the party demanding it may terminate the contract. B) Exceptio non A

205、dimpleti Contractus 3) The CISG a) requirements of anticipatory breach and remedies:(1)anticipatory breach takes place after the conclusion of the contract, and prior to the date for performance.(2) it is apparent that the other party will not perform a substantial part of his obligations as a resul

206、t of : a serious deficiency in his ability of performance or in his creditworthiness; or his conduct in preparing to perform or in performing the contract.b) remedies: suspend performance demand adequate assurance resume performance or terminate performanceB) Exceptio non Adimpleti Contractus 4) Chi

207、na Contract LawArticle 66: 同时履行抗辩权同时履行抗辩权Article 67: 先履行抗辩权先履行抗辩权Article 68: 不安抗辩权不安抗辩权1)business operations seriously deteriorating; 2) diverting properties and withdrawing capital to evade debts; 3)falling into business discredit; 4)other situations showing inability or possible inability to meet

208、liabilities.Article 69: 不安抗辩权的救济（不安抗辩权的救济（ 与与CISG相似）相似）Article 94（2）:预期违约预期违约III liquidated Damages 违约金违约金A) Common Lawa) concept: liquidated damages refer to the amount of money which shall be payable in the event of a breach of contract.b) function: to fix the sum which is to be paid irrespective

209、of the actual damage suffered by the breach.c) penalty clause: if the sum stated in the clause is not a genuine pre-estimate of loss, but the aim to punish the party in breach, the clause is a penalty clause and is invalid and unenforceable.Question: how about if the contracted sum is lower than the

210、 actual loss?III liquidated DamagesB) Civil LawFrench law: courts in principle cannot adjust such a stipulation by the parties to a contract.German law: liquidated damages even if characterized by punitive role is valid and enforceable.III liquidated DamagesC) the UNIDROIT PICC Article 7.4.13: 1) th

211、e aggrieved party is entitled to that sum irrespective of its actual harm.2) the sum may be reduced to a reasonable amount where it is grossly excessive in relation to the harm resulting from the non-performance and to the other circumstances.However, it may not be increased, where the agreed sum is

212、 lower than the harm actually sustained.III liquidated DamagesD) China Contract LawArticle 114: similar to that of the UNDROIT PICC.A slight difference: if the agreed sum is lower than the losses caused, any party may request the peoples court or an arbitration institution to increase it.IV Obligati

213、ons of the Seller and the BuyerA) Sellers Obligations actual delivery1. delivery of the goods constructive delivery1) Place of delivery (CISG)a)Contracted place, if not,b)When carriage involved, to the first carrierc) When carriage not involved, specific goods, place the goods at the buyers disposal

214、 at that place.; other cases, place the goods at the buyers disposal at the sellers business place at the time of the conclusion of the contract.A) Sellers Obligations 1. delivery of the goods2) time of delivery (CISG)a) fixed date stipulated by the contract.b) fixed period stipulated by the contrac

215、t, at any time within the period.c) other cases, within a reasonable time after the conclusion of the contract.A) Sellers Obligations2. turning over of documents the time the place conform to the requirementsUp to the time stipulated, the seller may cure any lack of conformity but without causing an

216、y damages to the buyer.A) Sellers Obligations3. the sellers assurance of the quality of goods (CISG)1) fit for the purposes for which goods of the same description would ordinarily be used;2) fit for any particular purpose expressly or impliedly made known to the seller at the time of the conclusion

217、 of the contract;3) possess the qualities of goods which the seller has held out to the buyer as a sample or modelA) Sellers Obligations4. assurance of the ownership of the goods (CISG)Seller must deliver the goods which are free from any right or claim of a third party, unless the buyer agreed to t

218、ake delivery subject to that right or claim.If such right or claim is based on industrial property or other intellectual property, the right or claim should be based on industrial property or other intellectual property a) under the law of the state where the goods will be used or resold or b) under

219、 the law of the buyers place of business.A) Sellers Obligations4. assurance of the ownership of the goods (CISG)Exclusion of sellers obligation of assurance of intellectual property rights:a) at the time of the conclusion of the contract the buyer knew or could not have been unaware of the right or

220、claim;b) the right or claim results from the sellers compliance with technical drawings, designs, formulas or other such specifications furnished by the buyer.B) Buyers Obligations1. payment of the pricePlace of payment (CISG)If the buyer is not bound to pay the price at any other particular place,

221、he must pay it to the seller:a) at the sellers place of business;b) if the payment is to be made against the handing-over of the goods or of documents, at the place where the handing-over takes place.B) Buyers Obligations2.taking delivery (CISG)a) doing all the acts which could reasonably be expecte

222、d him in order to enable the seller to make delivery;b) taking over the goods.If the buyer fails to cooperate, he will be responsible for any resulting costs, and if he fails to take delivery he assumes the risk for any damage to the goods after that time.V Passing of RiskA) Common LawThe English la

223、w: the party who bears the risk of loss is the party who has title to the goods, that is who owns them at that moment.The American law: abandon the title principle after the adoption of the UCC.V Passing of RiskB) the CISG1. allows the parties to decide the time of passing of risk;2. the effect of p

224、assing of risk: 3. where the goods need to be moveda) if the seller is not bound to hand the goods over at a particular place, the risk passes to the buyer when the goods are handed over to the first carrier for transmission b) ifat a particular place, the risk passes to the buyer when the goods are

225、 handed over to the carrier at that place.V Passing of RiskB) the CISG3. where the goods need to be movedc) the risk does not pass to the buyer until the goods are identified to the contract.4. the passing of risk of the goods in transita) from the time of the conclusion of the contractb) with regar

226、d to the particular case and its circumstances, the risk may be passed from the time the goods were handed over to the carrier who issued the documents of carriage.V Passing of RiskC) China Contract law1. contracted time of passing of risk;2. by the seller before the delivery, by the buyer after the

227、 delivery;3. where the goods needs carriage, by the buyer after the seller has delivered the goods to the first carrier.4. for goods on route of carriage, by buyer as of the time of the conclusion of the contract.V Passing of RiskC) China Contract law5. if goods not satisfied the quality, buyer may

228、refuse to accept or rescind the contract, the seller shall bear the risk;6. non-delivery due to causes of the buyer, the buyer shall bear the risk;7. if the seller put the goods at the place of delivery, but the buyer fails to take delivery ,the risk shall be borne by the buyer as of the date of bre

229、ach;8. even if the risk passes to buyer, his right to claim damages for the sellers breach may not be affected.VI Passing of PropertyA) Common Law (UCC)1) title to goods cannot pass prior to their identification to the contract;（划归合同项下）（划归合同项下）2) goods needs to be moved, but does not require the sel

230、ler to deliver them at destination, title passes at the time and place of shipment;3) if the contract requires delivery at destination, title passes on tender there;VI Passing of PropertyA) Common Law (UCC)4) goods needs not to be moved and the seller is to deliver a document of title, title passes

231、at the time when he delivers such documents.5) if at the time of contracting the goods are already identified and no documents are to be delivered, title passes at the time and place of contracting.VI Passing of PropertyB) the CISG1)the CISG provides in principle that the seller is obligated to tran

232、sfer the title to the buyer and make assurance to deliver the goods of which the third party cannot make any claim;2) CISG is not concerned with the effect which the contract may have on the property in the goods sold;3) the reason: considerable differences between the provisions of different countr

233、ies and it is extremely difficult to unify them.VI Passing of PropertyC) China Contract law1) the parties can make agreement on the time and place of the transfer of the title to goods;2) no such agreement, title transferred upon the delivery of goods.VII Excuses for Non-PerformanceA) Common law1. i

234、mpossibility of performance 履行不能履行不能Only objective impossibility of performance is excusable: impossible for anyone; the party did not expressly assume such risk. Eg:1) the death of one party;2) the destruction of the specific subject matter;3) performance of the contract has been render illegal or

235、made impossible due to the fault of the other party.VII Excuses for Non-PerformanceA) Common law2. supervening （随后产生（随后产生/意外产生）意外产生）illegalityExcusable when performance become illegal after the conclusion of the contract.3. frustration of purpose (rare) 合同受挫合同受挫A partys performance could be excused

236、if some unforeseen event occurred that frustrated the purpose of the contract. The event must have the effect to destroy totally the value of the contract to the party rely on the excuse. (see cases in p160)VII Excuses for Non-PerformanceA) Common law4. commercial impracticability 商业上不能实现商业上不能实现A pa

237、rty to a contract is prevented from performing may attempt to be excused under the doctrine of commercial impracticability. A thing is impracticable when it can be done only at an excessive and unreasonable cost.1) only if performance would result in extreme hardship, difficulty, or unreasonable exp

238、ense as a result of an unforeseen event.( discretion of court)2) the party should not have foreseen that an event of this kind could occur.Case 5-4 Transatlantic Financing Corporativon v. United StatesUS contracted a steamship from TFC to ship goods from Texas to IranSix days after the sailing ,the

239、Suez Canal blocked, the ship had to sail around the Cape of Good Hope.TFC sued for added expense USIssue: Was the performance of this contract rendered legal impossible? (commercially impracticable)Decision: NoReasoning: the risk of closure of the canal became part of the dickered terms. The goods w

240、ere not subject to harm, the vessel and crew were fit, TFC was no less able to purchase insurance to conver risks. Under a voyage charter, the risks of the journey are on the shipowner, and an increase in expense due to a change in route did not excuse its performance under contract.VII Excuses for

241、Non-PerformanceB) the UNIDROIT PICCArticle 6.2.2: there is hardship where the occurrence of events fundamentally alters the equilibrium of the contract either because the cost of a partys performance has increased or because the value of the performance a party receives has diminished.Conditions:1)

242、events occur or become known after the conclusion of the contract;2) could not reasonably have been taken into account by the disadvantaged party;3) beyond control of the disadvantaged party;4) the disadvantaged party did not expressly assume the risk.VII Excuses for Non-PerformanceB) the UNIDROIT P

243、ICCEffect of hardship:1) disadvantaged party is entitled to request negotiations;2) upon failure to reach agreement within a reasonable time either party may resort to the court;3) if the court decides hardship exists:a) terminate the contract;b) adapt the contract with a view to restoring its equil

244、ibriumVII Excuses for Non-PerformanceC) the CISGThe CISG uses the term impediments beyond control.1) the impediment was not reasonably foreseen at the time of conclusion of contract;2) unavoidable or beyond his control;3) notice must be given to the other party( the impediment and its effect)Effect

245、of impediment: suspend performance during the time the impediment exists.VII Excuses for Non-PerformanceD) Force Majeure ClausesForce majeure clauses generally do not excuse a partys nonperformance entirely, but only suspend it for the duration of the force majeure.Notice and certificate attesting f

246、orce majeure events must be given at a fixed time or reasonable time.Models of force majeure clauses:1) a model of generality2) a model of listing 3) a model of comprehensiveness (p166)Chapter Six Carriage of Goods by Sea and Marine Cargo InsuranceI Charterparties 租船运输租船运输合同合同The charterparty is a c

247、ontract whereby the charterer hires a ship from the shipowner.Types of charterparties:Voyage charterparty 航航次次租船合同租船合同Time charterparty 航期租船合同航期租船合同Charterparty by dimise 光船租船合同光船租船合同I CharterpartiesA) Voyage Charterparties 航次租船合同航次租船合同A contract by which the charterer hires a ship and its crew for

248、the carriage of goods from one place (port of loading ) to another (port of discharge).1) obligations of the parties:Shipowner: provides the ship at named port at specified time ( seaworthy), carries the goods to destination (no unjustifiable deviation).Charterer: provides a full cargo, arranges loa

249、ding and pays the carriageI CharterpartiesA) Voyage Charterparties航次租船合同航次租船合同2) lay days and demurrage or dispatchLay days（装船或卸船期）（装船或卸船期） are the time specified in the charterparty for loading or unloading, often counted by working days or weather working days.Demurrage （滞期费）滞期费）: if lay days are

250、exceeded and the ship is detained longer than agreed, demurrage is payable by the charterer to the shipowner.Dispatch （速遣费）（速遣费）: if loading or unloading finished before the lay days expires, dispatch is payable by shipowner to charterer.I CharterpartiesB) time charterparties 航期租船合同航期租船合同Under a tim

251、e charterparty the charterer engages the use of a vessel for a agreed period of time.The charterer has the right to direct the ship to proceed to wherever it is needed, only limitations includes: lawful trades, lawful goods and safe ports.The charterer usually pays monthly, otherwise the shipowner h

252、as the right to withdraw the ship.I CharterpartiesC) charterparties by demise 光船租船合同光船租船合同Known in the American law bare boat charterparty.The charterer obtains possession and control of the ship and put in his own master and crew.This modes of contract is often used in the oil tanker trade.II Bills

253、 of Lading 提单提单Concept: a bill of lading is an instrument issued by an ocean carrier to a shipper with whom the carrier has entered into a contract for the carriage of goods, which states that certain goods have been shipped on a particular ship or have been received for shipment.Carrier shipper ban

254、k consignee carrierII Bills of LadingA) Laws on Bill of Lading1. the Harter Act：US18922. the Hague Rules 海牙规则海牙规则(the International Convention For The Unification of Certain Rules of Law Relating to Bills of Lading) incomplete fault liability. 不完全过失责任不完全过失责任3. the Hague-Visby Rules: 海牙海牙-维斯比规则维斯比规则r

255、evision on the Hague Rules in 1968, but no substantial modification.II Bills of LadingA) Laws on Bill of Lading4. the Hamburg Rules 汉堡规则汉堡规则(the United Nations Convention on the Carriage of Goods by Sea):complete fault liability.完全过失责任完全过失责任5. Maritime Code of the Peoples Republic of China: 中华人民共和国海

256、商法中华人民共和国海商法transplanted into it some important international convention.II Bills of LadingB) Characteristics of the Bills of Lading1. receipt: which the carrier gives the shipper acknowledging that he has shipped the goods in a named ship, or he that he has received the goods for shipment.Prima fac

257、ie evidence (初步证据) between the carrier and shipperFinal evidence between the carrier and the endorsees Shipped bill of lading Received bill of lading which is more valuable?II Bills of LadingB) Characteristics of the Bills of Lading2. evidence of the contract of carriage by seaNot the contract itsel

258、f but evidence of the existence and content of the contract. What is the difference?3. as document of titleThe carrier must deliver the goods to the person who holds and presents to him the original bill of lading.How does the carrier deal with the case when nobody tenders the bill of lading on arri

259、val of the vessel?II Bills of LadingC) Carriers Duties under Bill of Lading 1. to exercise due diligence to the ship seaworthy, before and at the beginning of the voyage.a) due diligence: refers to the diligence reasonably expected from, and ordinarily exercised by, a person who seeks to satisfy a l

260、egal requirement or to discharge an obligation. Neither extraordinary diligence or ordinary diligence.b) seaworthiness of the ship: type of ship, condition and suitability of its equipment, competence of its crew, stowing of the cargo, prepare for the weather expected etc (p180)II Bills of LadingC)

261、Carriers Duties under Bill of Lading2. to exercise due diligence to properly and carefully loading, handling, stowing, carrying, keeping, caring for, and discharging the goods. Material deviation is not allowed. But any deviation in saving or attempting to save life or property at sea or any reasona

262、ble deviation shall not constitute a infringement or breach of contract.Most courts have held that stowage of cargo above deck under a clean bill of lading without the consent of the shipper is deemed to be an unreasonable material deviation.II Bills of LadingD) Carriers Immunities17 immunities to e

263、xcuse the carriers liabilities, of which the most important is “ act, neglect, or default of the master, mariner, pilot, or the servants of the carrier in the navigation or in the management of the ship”The Hamburg Rules most important modification:a) cancel the immunities mentioned above;b) prolong

264、ed the carriers period of responsibility: from the time he has taken over the goods until the time he has delivered the goods.II Bills of LadingE) Delayed Bills of Lading Due to unforeseen things happens irregularly in international trade, sometimes a carrier can not find the holder of original bill

265、 of lading (delayed, lost, or stolen) when he arrive at destination, thus may occurs the delivery of the goods without bill of lading, taking the delivery against indemnity, or even frauds.1. delivery of goods without the bill of lading: the carrier can not exempt from the liability.2. taking delive

266、ry against indemnity(保函保函): usual practice, but much controversy over its nature and whether the carrier is bound to accept an indemnity.II Bills of LadingF) Frauds on Bills of Lading1. false bills of lading：伪造提单伪造提单 2. antedated bills of lading：倒签提单倒签提单Bills of lading issued after the goods have be

267、en shipped but with the date earlier than actual shipping date.3.advanced bills of lading：预借提单预借提单Bills of lading issued under requirement of seller by a carrier who is already in management of the goods but not yet shipped it, or is shipping the goods but not finished yet.4.clean bills of lading is

268、sued through indemnity: clean bills of lading and unclean bills of lading ? Liability?III Marine Cargo Insurance1. the necessity to cover insurance for the goods transported by seaPerils losses2. by which party the cost of marine insurance shall be borne?a) the buyerb) the seller III Marine Cargo In

269、suranceA) Marine Insurance Policies and CertificatesServes as the insurance contract, evidence by which the insured lodge a claim against the insurance company.1. insurance policy2. insurance certificate: simplified insurance policy3. floating policy: total amount4. open cover policy: a time period5

270、. blanket policy: more convenient, does not need to advise the insurer of the individual shipment, a lump sum premium applied.Definition of floating policyInsurance cover for situations where the total insurable amount can be reasonably estimated but cannot be determined accurately-enough for comput

271、ing correct premium, until the insurance policy comes to an end. For example, a trader will take a floating policy on a sum estimated to be large enough to cover shipments during a period (say, one year) and pays premium accordingly. As the shipments are sent out, the insurer is informed and the val

272、ue of those shipments is deducted from the insured sum. This procedure is repeated until the insured sum is almost exhausted. The insurer then recomputes the premium according to the total value of the already-sent shipments, and adjusts it against the premium paid by the trader. At this stage the t

273、rader takes another floating policy and whole process starts over again.III Marine Cargo InsuranceB) Perils and Losses1. perils a) perils of the sea: natural calamities and fortuitous accidents, such as thunder, earthquake, shipstranded, collision etc.b) extraneous risks: including general extraneou

274、s risks like theft, rain, shortage, leakage etc and special extraneous risks like war risks, strikes, non-delivery, refusal to receive cargo.III Marine Cargo InsuranceB) Perils and Losses2. losses actual total lossa) total loss constructive total loss particular averageb) partial loss general averag

275、e General average is a loss that results when extraordinary expenses or losses are incurred in saving the vessel or its cargo from danger at sea. (p187)III Marine Cargo InsuranceC) Insurance Cover1. FPA (free from particular average) 平安险平安险a) total loss (actual and constructive)b) partial losses due

276、 to the ship being on fire, stranded, sinking, colliding, or meeting other fortuitous accidents.2. WPA ( with particular average) 水渍险水渍险FPA coverage + partial losses caused by natural calamities3. All Risks 一切险一切险WPA coverage + losses caused by general extraneous risksChapter Seven Finance of Intern

277、ational TradeI Bills of ExchangeII Collection of Documentary Bills through BanksIII Letters of Credit IV International FactoringI Bills of ExchangeA) the ConceptA bill of exchange is a negotiable instrument, signed and issued by the drawer, who authorizes the drawee to pay unconditionally a sum cert

278、ain in money to the payee or the holder at sight or on a specific date.汇票是汇票是出票人出票人签发的签发的流通票据流通票据，授权，授权受票人受票人在见在见票时或某一确定的时间无条件支付票时或某一确定的时间无条件支付受（收）款人受（收）款人或者持票人或者持票人确定金额的货币。确定金额的货币。I Bills of ExchangeB) the Laws Governing Bills of ExchangeEngland: Bills of Exchange Act (1882)USA: Uniform Negotiable

279、Instrument Law (1896) UCCInternational: Convention on the Unification of the Law Relating to Bills of ExchangeChina: the Law of the Peoples Republic of China on Negotiable InstrumentsI Bills of ExchangeC) Types of Bills of Exchange1. clean bill and documentary billA bill of exchange is called a clea

280、n bill when no shipping documents are accompanied with it.If the bill of exchange is accompanied by shipping documents, the bill is called a documentary bill.2. sight (demand) bill and time ( usance) bill If the drawee is required to pay on demand or at sight, the bill is a sight bill;If the drawee

281、is required to pay at a later date, the bill is a time bill.I Bills of ExchangeC) Types of Bills of Exchange3. commercial bill and bankers billIf the drawer is a commercial firm, the bill is a commercial bill;If the drawer is a bank, the bill is a bankers bill.4. commercial acceptance bill and banke

282、rs acceptance billIn time commercial bills, when the drawer is a commercial firm and the drawee is another commercial firm, the bill after acceptance by the commercial firm or the drawee is a commercial acceptance;When the drawer is a commercial firm or a bank and drawee is a bank, the bill after ac

283、ceptance by the bank or the drawee is a bankers acceptance bill.I Bills of ExchangeD) Common Procedures in handling Bills of Exchange1. drawing Name of the drawee( payer)Amount payableDate of paymentSignature of the drawerI Bills of ExchangeD) Common Procedures in handling Bills of Exchange2. presen

284、tationThe act of the holder in presenting the bill to the drawee asking the latter either to pay (Presentation for payment) or to accept the bill (presentation for acceptance).3. acceptanceThe act of the drawee to show his responsibility by accepting the time bill for payment at a fixed future date

285、by writing the word “acceptance”, marking the date of acceptance and signing on the face of the bill.I Bills of ExchangeD) Common Procedures in handling Bills of Exchange4. endorsementNegotiable instrument, circulative and transferable.Endorsement is the means of transferring the rights of the bill

286、to another. General endorsement: signing the name of the endorser and the endorsee on the back of the bill.Blank endorsement: only signing the name of the endorser. ( the bill payable to bearer or holder)I Bills of ExchangeD) Common Procedures in handling Bills of Exchange5. paymentSight (demand): i

287、mmediate payment on presentation by the holder.Time (usance): acceptance payment on due date.6. dishonour and protestingDishonour: non-acceptance and non-paymentProtesting: holder must furnish a formal notice of dishonour to the parties he wishes to recourse.II Collection of Documentary Bills throug

288、h BanksA) ConceptThe exporter asks his bank to arrange for the acceptance or payment of the bill overseas, and the bank will carry out his task through its own branch office abroad or a correspondent bank, this procedure is called collection of proceeds of sale.II Collection of Documentary Bills thr

289、ough BanksB) Types of Collection1. documents against acceptance (D/A)D/A means the documents shall be delivered to the buyer on acceptance of the bill.Risky to the seller, used where the seller knows the buyer or the deal is small2. documents against payment (D/P)D/P means the documents shall be del

290、ivered to the buyer on actual payment of the bill.Safer to the sellerII Collection of Documentary Bills through BanksC) Advantage of Collection1. quick and time-saving2. save money ( do not need to pay high expenses and make large deposit in the bank)III Letter of Credit (L/C)A) ConceptA letter of c

291、redit is a contract between the bank and seller, or a promise by the bank that it will pay to the seller the amount of the contracted price on condition that the seller presents to the bank the documents required by the credit.III Letter of Credit (L/C)B) Laws Applicable to Letters of CreditUniform

292、Customs and Practice for Documentary Credits (UCP500)By International Chamber of Commerce (ICC)Latest revision: UCP600 (2004)III Letter of Credit (L/C)C) Types of Letters of Credit1. confirmed L/C保兑信用证保兑信用证: apart from the assurance of the issuing bank to the exporter, there is another bank which as

293、sure the payment.2. application cases:A) exports to countries that have shortage of foreign currencies, large foreign debts, and a poor balance of payment.B) the seller may be unsure of the soundness of the buyers bank and wants the backing of some reputable international bank. Eg: the citibank, Sta

294、ndard Chartered Bank.III Letter of Credit (L/C)2. Standby L/C备用信用证备用信用证: most standby credits today are used not in sale-of-goods transactions, but as a guaranties of performance under consulting and performance contracts. If the obligation of the guaranteed contract is performed, then the standby c

295、redits become invalid, otherwise the credits comes into effect and be used.A) to guarantee that the performance of a service /construction/sales contract.B) to insure the payment of a loan.III Letter of Credit (L/C)3. transferable L/C可转让信用证可转让信用证: a credit which authorizes the beneficiary to transfe

296、r part or whole of the benefit of the credit to someone else.Application: between agent and principal or resale of the goods.4. revolving L/C循环信用证循环信用证: a revolving credit is one where the amount is renewed or reinstated without amending the credit. It can be revolving in time or in amount.III Lette

297、r of Credit (L/C)5. red clauses credits红条款信用证红条款信用证: is a financing tool for smaller sellers who need capital to produce the contracted products under a letter of credit.The red clause is a promise by the issuing bank to reimburse the sellers bank for loans made to the seller. Ultimately the liabili

298、ty will fall on the buyer if the seller defaults on shipment or repayment of the amount taken under the credit.III Letter of Credit (L/C)D) the stages of the payment arranged by L/C1. the exporter and importer agree in the sales contract that payment shall be made by L/c.2. the buyer instructs a ban

299、k at his place of residence (known as issuing bank or buyers bank) to make a credit for the exporter on the terms agreed upon in the sales contract.3. the issuing bank arranges with a bank at the residence of the exporter (known as the advising bank or sellers bank ) to negotiate, accept or pay the

300、exporters draft upon delivery of the shipping documents by the seller.)D) the stages of the payment arranged by L/C4. the advising bank advises the exporter that it will negotiate, accept or pay his draft.5. the exporter makes shipments of the goods. prepares the set of documents needed and ask the

301、advising bank to negotiate, or pay the draft.6. the sellers bank negotiates or pays the draft and then asks the buyers bank to reimburses.7. the buyers bank reimburses the sellers bank and asks the buyer to buy the bills.8. the buyer buys the bills and then can take delivery of goods.the stages of t

302、he payment arranged by L/CAAAAapplicant（importer）PayingbankAdvising bankbeneficiary（exporter）IssuingbankNegotiating bankIII Letter of Credit (L/C)E) Independence principle and rule of strict compliance1. independence principle 独立的原则独立的原则: this principle means that the banks obligations under the L/C

303、 are independent from the buyers and sellers obligations under the contract for the sale of goods.All parties concerned deal with documents, not with goods, service or other performances to which the documents may relate.III Letter of Credit (L/C)E) Independence principle and rule of strict complian

304、ce2. rule of strict compliance 严格相符的规则严格相符的规则: the documents tendered must strictly conform to the requirements of the L/C, otherwise the draft may be dishonored. If the issuing bank buys documents that contain a discrepancy, it can not be reimbursed by the buyer.Some typographical errors （印刷错误）（印刷错

305、误）are excusable.III Letter of Credit (L/C)F) Fraud exception in L/C transactionIndependence principle transaction of documents fraud happens The doctrine of fraud exception means that even if the documents delivered by the beneficiary are in strict compliance with the L/c, if a bank or applicant sho

306、ws definite proof that the beneficiary has made forged documents, the bank has the right to reject payment, and the applicant is entitled the court to issue injunction against payment of the beneficiary.UCP500 has no specific provisions on fraud exception, national courts began to fill the gaps.IV I

307、nternational Factoring国际保理国际保理A) definitionInternational factoring is a contract entered into by the supplier and the factor, by which the supplier assigns to the factor receivables（应收帐（应收帐款）款） arising from a specific transaction with its customers, and the factor provides to the supplier financing（

308、融资）（融资）, maintenace of accornts relating to receivables（应收帐款管理（应收帐款管理） and the collection of receivables（帐款的收取）（帐款的收取）.IV International Factoring国际保理国际保理B) Obligations of the parties1. obligations of the supplier1) assign his existing or future receivables to the factor by a contract.2) take the rec

309、eivables returned by the factor. The factor has recourse on it if the debtor rejects payment due to suppliers failure to perform the sales contract.3) pay the contracted interests and related expenses.IV International Factoring国际保理国际保理2. obligations of the factor1) provide credit investigation on th

310、e debtor.2) provide trade financing if required by the supplier.3) provide maintenance of the accounts relating to receivables.4) provide full protection against bad debts.IV International Factoring国际保理国际保理C) advantages to exporter1. factors shall evaluate the creditworthiness of the buyer so that t

311、he exporter does not need to spend money on credit investigation.2.the exporter can obtain more than 80% trade financing at the time of assigning the receivables to a factor after shippment.3. the factor guarantees the payment.4. international factoring is a accounting tool.Of the L/C transactions i

312、n China about 80% have discrepancies which are often misused by dishonest foreign merchants as excuses for dishonor.IV International Factoring国际保理国际保理D) advantages to the importer1. the importer can save a big sum required as deposit and other expenses in L/C transactions.2. international factoring is in fact a credit loan to the importer.