Archive for April 24, 2011

Incoterms 2010 ICC rules for the use of domestic and international trade terms

admin / April 24, 2011 / No comments

The 1st of January 2011 the International Chamber of Commerce (ICC) will release a new version of INCOTERMS under the title, “Incoterms 2010 ICC rules for the use of domestic and international trade terms“. Such version, through a clear and easy understanding wording, encourages the application of the International Commercial Terms (INCOTERMS) not only for international trade but also for domestic. 

1. Use of INCOTERMS

Companies are increasingly applying INCOTERMS in those transactions that entail goods delivery. INCOTERMS are terms that are well established and worldwide accepted, yet it is always advisable, for those companies, to execute an agreement whereby, besides the application of the INCOTERM, there are other aspects within the transactions that need regulating which the INCOTERM cannot cover. Moreover, such other aspects, in many cases, are directly related to the INCOTERM per se.

It is also important to take into account that the INCOTERMS are not law and therefore new versions shall not overrule previous ones. That is why it is so important that the INCOTERM is written clearly and referring to the version that it applies. The correct formula would be: INCOTERM-delivery place-ICC-version. Regarding the delivery place, the new version 2010 suggests to clearly specify the exact place where the goods are to be delivered in order to know where risk and responsibilities are transferred. Eg: EXW 42, Padwell Road, London SW6 7LZ UK ICC 2010.

2. New Classification

The ICC has decided to classify INCOTERMS in two groups, depending on modes of transport: the first group would be comprised by INCOTERMS that apply for more than one mode of transport (EXW, FCA, CPT, CIP, DAT, DAP, DDP) and the second group would be comprised by INCOTERMS that apply only for sea or inland watergate transport (FAS, FOB, CFR, CIF). Therefore, the old classification by groups of letters (E, C, F, D) shall no longer exist.

As an outstanding novelty 4 INCOTERMS (DAF, DES, DEQ y DDU) haven been eliminated and 2 new INCOTERMS (DAT and DAP) have been brought in. Therefore the new version will be comprised by the following INCOTERMS: EXW, FCA, FAS, FOB, CFR, CIF, CPT, CIP, DAT, DAP y DDP.

3. Pragmatic approach

The ICC being aware of the technology progress within the business world has tried to facilitate the possibility that the parties may “use any electronic record or procedure if agreed between the parties or customary”.

Other relevant novelties are: on one hand, the regulation of the allocation of costs between seller and buyer, which is mainly based on trying to avoid that the costs of terminal handling charges (THC) are borne twice and, on the other hand, the preoccupation for the safety of the goods while transporting them, establishing therefore reciprocated obligations for both parties.

4. Choosing the appropriate INCOTERM

In order to choose the appropriate INCOTERM, we should take into consideration some circumstances that in principle may seem irrelevant, but in reality they may entail costs that may have not been budgeted in advance, for example:

With FOB the obligation of delivery shall not be complied with once the goods have passed the ship’s rail but once the goods have been placed on board. The risk in stowing is borne by the buyer although stowing costs are included within the costs of loading which are borne by the seller; With CFR unloading will be borne by the buyer except otherwise agreed by the parties; With CIF the moment where the risk is passed on to the buyer will take place when the goods are delivered on board the ship; With CPT unloading shall be borne by the buyer except it has to be borne by the seller pursuant the agreement of transport; EXW is not advisable for a seller, nor DAP for a buyer, when payment has been set through documentary credit; Certain countries do not allow VAT taxes payment by a party other than the local importer, therefore in the event that the parties agree a DDP this shall be “VAT excluded”; In those cases where the seller is obliged to hire an insurance to cover the risk during transportation, the seller shall hire such insurance under the name of the buyer not under its own name, otherwise, the INCOTERM‘s nature would be diminished.

 

5. Two new incorporations

Finally, a brief summary about the new two INCOTERMS, DAT and DAP, that the ICC has incorporated to this new version 2010:

DAT (Delivered at Terminal) will replace, for sea transportation, the old DES and DEQ. With the INCOTERM DAT the seller bears the costs of transport and the risks until the goods are left unloaded at the terminal that the parties had agreed upon. “Terminal includes any place, whether covered or not, such as a quay, warehouse, container yard or road, rail or air cargo terminal.”

 DAP (Delivered at Place), however, will replace the old DAF, DES and DDU. With the INCOTERM DAP the seller shall bear all transport costs and the risk up to delivery which will take place “when the goods are placed at the disposal of the buyer on the arriving means of transport ready for unloading at the named place of destination”.

Alex Castro 

ARPA Abogados Consultores

Member of Eurojuris España

Category: international trade / Tags: ,

Captain, crew snd management – who does what?

admin / April 23, 2011 / No comments

Unsure of the different roles of the captain, crew and management?  Here’s an overview…

Management – yacht management hires the captain and crew on behalf of the boat owner.  Management might also arrange maintenance when the motor yacht is in port and arrange delivery and moorings year-round.

Captain – when the yacht is enroute, the captain has ultimate command of the vessel. Everything about the yacht is the captain’s responsibility.  A captain must be licensed – a master’s license like that held by Captain Stuart Carter allows the captain to operate worldwide.

The captain maps out the route, taking into account whether, channels and any other factors. The captain must comply with customs and immigration laws, so it is up to the captain to maintain the vessel’s certificates and complete all documentation. 

As well as navigation and documentation, the captain’s role includes management of staff, cargo, cash and inventory.  The crew all report to the captain.  The captain is also responsible for the cleanliness and seaworthiness.  In rough conditions, the captain’s priority is the personal safety of captain, crew and owner by keeping the yacht safe.

Crew – there are a number of different crew roles, but they all ultimately report to the captain.  The captain is usually responsible for choosing the boat’s crew, however a relief captain or delivery captain often works with the vessel’s fulltime crew.  Whilst all boat crews vary in their make up, the most common crew roles are:

First mate, often called chief mate or chief officer, reports to the captain and is in charge of the deck crew and cargo. Deckhand assists with the daily running and maintenance of a vessel.  Deckhands’ tasks are variable depending on the vessel. Coxswain reports to the captain as a senior, licensed crew member responsible for navigation. not all vessels have a coxswain. Steward/ess is an unlicensed crew member who reports to the captain and does stocking, cleaning and assisting with preparation and serving of meals.  A Chief Steward is the senior unlicensed crew member who is responsible for meals and cleaning. Cook or chief cook is senior unlicensed crew responsible for preparing meals and maintaining the yacht’s galley.

If the captain, crew and management work together, it’s “smooth sailing” for the owner of the motor yacht!

Trivia – Seems everyone wants to be captain or crew of a yacht… golfers have a game variation called captain and crew.  There is also a dice game called ship captain crew!

Category: international management / Tags: ,

Dehydrated Food = Big $$$? A Sundance Global (eFoods Global) Scam

admin / April 22, 2011 / No comments

eFoods Global (aka Sundance Global) is a new network marketing company currently in its pre-launch phase (goes live in Nov. 2010) that is taking preparing for the worst to a whole new level. As an MLM offspring of non-perishable/storable foods giant, eFoodsDirect,  its purpose is to help people prepare for good and bad times by providing them with high-quality, storable food that they’ll actually want to eat and to help its Independent Business Owners make a substantial income in the process.

Sundance Global (eFoods Global) Scam Review

Even though the company is brand new to MLM, they are no stranger to the emergency foods industry. In fact, through their parent company, they have over 28 years experience providing storable food solutions to thousands of people. If you’re like me, the thought of storable food brings to mind the barely edible rations that have been called food for the military for the last 75 years. The good thing is that’s not at all the case with Sundance Global (eFoods Global).

Even though the food will last up to 15 years if stored properly and is dehydrated, everything is made from fresh raw foods, and they don’t use any genetically modified ingredients, trans fats, or garbage like MSG to make it edible. Initially, I didn’t really see the appeal of the idea as a business at first, but after poking around the eFoods Global (Sundance Global) website, they did raise some very valid points on why someone would want to have their own stock pile of food. You might want to wait to review the reasons if you’re going to sleep soon. :D

With most people who are considering the home business industry for the first time, one of the most pressing questions that they have is, “Is this a scam?”. The simplest way to determine if you’re looking at a legitimate business opportunity is to ask yourself, “What service or product does this company sell?”. If you can’t easily tell, that’s a strong indication that you should probably run!

Review of the Sundance Global (eFoods Global) Business

The compensation plan that’s provided to all IBO’s is based on a binary model which means that your business is built with two separate “legs” (like an upside down peace sign). They pay 10% weekly commissions on the volume of the smaller leg, and include up to a 25% bonus match on your personally recruited IBO’s that you’ll be training. There will probably be additional bonuses and commissions that you can earn which will be announced after eFoods Global (Sundance Global) officially launches this month.

There are a few incentives that they are offering to people who join ($29.95 fee) before they go live:

- All new IBO’s will receive a voucher for $20 worth of free food (and an additional $20 for every 2 people they refer who use their vouchers).

- Until 11/15/10, the company is giving its IBO’s one share in its “Global Founders Pool” where the company will share 1% of its revenues with the IBO’s who join at the beginning.

The truth is that even if you get in with a company like eFoods Global (Sundance Global) at the beginning, it’s not a guarantee at success or a magic bullet that’s going to make everything easy. It’s absolutely crucial to learn how to market your business the right way so you won’t have to live or die by whether or not your best friend decides to join you. My recommendation is to find a mentor who can link arms with you and show you how to properly produce leads for your business, because they are paramount to your success.

(Disclaimer: I am not affiliated with Sundance Global (eFoods Global) in any way and am providing an unbiased review to help you determine for yourself if it’s a scam or legitimate business.)

Category: global business / Tags: ,
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