Contracts

This section for negotiations and conclusions of contracts various commodities, Incoterms basis, standard contracts (GAFTA, FOSFA), way of payments (LC, BG, CAD) and etc., as it mentioned below in sections terms.  

A contract is an exchange of promises between two or more parties to do or refrain from doing an act which is enforceable in a court of law.

Contract could be present for you based on specific condition of your commodity and terms. Section is for contracts on F basis as per Incoterms 2010 such as FOB, FAS, FCA. 

Basic items in the short form contract are: Sellers; Buyers; Quantity; Description of goods; Quality of goods; Packing; Shipment date; Price; Payment; Other conditions.

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     A contract is an exchange of promises between two or more parties to do or refrain from doing an act which is enforceable in a court of law. It is where an unqualified offer meets a qualified acceptance and the parties reach Consensus ad Idem. The parties must have the necessary capacity to contract and the contract must not be either trifling, indeterminate, impossible or illegal.
     Contract law is based on the principle expressed in the Latin phrase pacta sunt servanda (pacts must be kept). Breach of contract is recognised by the law and remedies can be provided. Sometimes written contracts are required, such as when buying a house. However, most contracts can be and are made orally, such as purchasing a book or a sandwich. Contract law can be classified, as is habitual in civil law systems, as part of a general law of obligations (along with tort, unjust enrichment or restitution).
    According to legal scholar Sir John William Salmond, a contract is an agreement creating and defining the obligations between two or more parties.
In common law systems, the five key requirements for the creation of a contract are:
1. offer and acceptance (agreement)
2. consideration
3. an intention to create legal relations
4. legal capacity
5. formalities

In civil law systems, the concept of consideration is not central. In addition, for some contracts formalities must be complied with under what is sometimes called a statute of frauds.
COMMON CONTRACT TERMS
Traders generally use a short form contract identifying key parameters when agreeing a sale and then incorporate standard terms and conditions by reference. At least 70% of those contracts for the international sale of grain and feedstuffs will incorporate Gafta standard forms of contract. This paper will deal only with trades incorporating Gafta contracts and will distinguish between СIF (cost insurance and freight) and FOB (free on board contracts).
The choice of whether to contract on an FOB or СIF basis depends on a number of factors not least of which is whether the trader in question has the capacity or inclination to get involved in organizing their own freight. I will deal later with the basic differences between GIF and FOB contracts but will turn now to look at the short form contracts, which generally traders will enter into. The following are the basic items which are generally identified in the short form contract.
1.    Sellers
2.    Buyers
3.    Quantity
4.    Description of goods.
5.    Quality of goods
6.    Packing
7.    Shipment date
8.    Price
9.    Payment
10.    Other conditions.

1 and 2. Sellers and Buyers
This is usually one of the easiest items to identify however even then in identifying the parties, care must be taken to consider any agency relationships. Is the seller acting on behalf of an undisclosed principle or acting for their own account? It would also be helpful to ensure that the buyers and sellers addresses and contact numbers are properly identified - very useful for communications at a later stage. Their registered office of a party may of course not be their usual place of business.

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Seller: __ Represented by Mr. , Director, acting in accordance with the Articles of Association, on the one part, and
Buyer: ___ Represented by Mr. , Director, acting in accordance with Articles of Association, on the other part, have made this Contract whereby it is agreed as follows.
1. Goods. Sunflower seeds in bulk, crop 20_, Ukraine origin.
2. Price. USD 000.00 () per MT delivered Free On Board stowed and trimmed (FOB – Incoterms) one safe berth of port.
3. Quantity. ,000 metric tons +/-10% in buyer’s option. Final at loading port as per Certificates of Quantity issued by a first class surveyor company (over 0.5 per cent difference of weighing at load port and draft survey on Seller's account). Inspection to be ordered and paid by the Buyer. Seller has his right to order inspection company on his own expences for checking of quantity.
4. Quality. Quality final at loading as per SGS certificates at sellers costs. Buyers have the right to appoint their own FOSFA approved surveyor to perform co-joint sampling of the cargo. Such surveyor for buyers’ account.
Specification: - Oil content: Basis 44% oil, TQ, reciprocal allowances 1,5% for each 1% over or under the basis, fractions in proportion.

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Contract: 450  Date : 14/03/20_
Seller: __ , represented by Mr. , Director, acting in accordance with the Articles of Association, on the one part, and
Buyer: __, represented by Mr. , Director, acting in accordance with Articles of Association, on the other part, have made this Contract whereby it is agreed as follows.
1. Goods. Crude sunflower seed oil in bulk produced from crop , Ukrainian origin. Total value of the contract is USD _.00 +/- 2%
2. Price. Price at USD 0.00 per MT delivered Free On Board vessel (FOB – Incoterms) one safe berth of port.
3. Quantity. 3,000 metric tons 5 % more or less in buyer’s option. Final at loading port as per Certificates of quantity issued by first class FOSFA approved surveyor. Inspection to be ordered and paid by the Buyer.
4. Quality. Final at loading port as per Certificates of quality issued by first class FOSFA approved surveyor with following specification:
Humidity:    max 0.30 %,
Impurities: max 0.20 %,

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Gafta contract of selling commodities (barley) in bulk. Incoterms  COST AND FREIGHT FREE OUT  (CFR - FO) Contract could be present for you based on specific condition of your commodity and terms.
Seller: Represented by Mr. _., Director, acting in accordance with the Articles of Association, on the one part, and
Buyer: Represented by director Mr. ___, acting on the basis of the Articles of Association on the other hand, have concluded the present Contract as follows:
Broker:
Commodity: Black Sea origin Feed Barley in bulk.
Quality: Test weight    min. 62/63 Kg/hl, GAFTA
Moisture max. 14,5 %
Admixture max. 2,0 %
Barley of sound, loyal and merchantable quality.
Goods to be free from alive weevils or other insects injurious and disease to stored grain, free from foul smell and infestation and foreign smell and materials.
Minimum 5 % of the total quantity of barley shipped to be coloured with food red Azorubine / Carmosine colour index number 14720.

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Contract could be present for you based on specific condition of your commodity and terms. Gafta contract of selling peas in bulk by vessel. Incoterms  cost and freight free out  (cfr - fo). We have the pleasure to confirm the following business: business done 01 june. sellers: buyers: broker:
goods: yellow/green feed peas – crop 2001 – origin:  black sea countries
moisture 14 pct max. Gafta
admixture 2 pct max
goods  to be sound, loyal, merchantable, free from alive insect and foreign smell
quantity: 5.000 (five thousand) metric tons 10 pct more or lessa at seller’s option and at contract price. Cargo – part/cargo at seler’s option bulk carrier single decker vessel only. weight: certified by a first class superintendet company of first class at loading and final at discharge wiht a tollerance/ franchise of 0,50 pct  in favour of sellers. Any exceedng loss in wheight over 0,50 pct will be refounded to buyers  from sellers against invoice

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Contract of selling commodities - Sunflower seed meal in bulk. Incoterms CPT CARRIAGE PAID TO (... named place of destination) Contract could be present for you based on specific condition of your commodity and terms. 
CONTRACT No.00B
SELLER: BUYER:
The Seller and the Buyer have this day entered into a Contract on the following terms and conditions:
COMMODITY: Sunflower seed meal in bulk (hereinafter referred to as Goods), produced from crop , origin Ukraine.
QUANTITY: 3.000 (three thousand) metric tons 5 % more or less at Buyer's option.
QUALITY/WEIGHT: Goods is to be merchantable, free of infestation and foreign smell, free from alive insects and to correspond to the following characteristics:
Moisture: 10 %, max.
Fat: 2 %,  max.
Protein(on dry basis): 36 % , min.
Fibers: 18 %, max 

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We can prepare contract for Peas with GAFTA 88 FLCs applied between Seller and Buyer via Broker based on own experience.
The SELLER are ready for negotiation of contract via Broker to sell, supply and transfer commodities are looking for Buyer ready to buy, purchase and receive commodities.
Yellow Peas
Moisture: max 14 pct;
Foreign Matter: max 2 pct;
Broken: max 5 pct;
Damaged: max 5 pct;
Other colour: max 3 pct;
Sound, loyal and merchantable, free from alive weevils, foreign smell, with natural color and smell.
Quantity and Quality of commodities final at place of stuffing into containers.
Shipments in 20 feet containers.
Payment for commodities to be made by the Buyer in US dollars 100% CAFD (Cash Against Fax Documents) against presentation the following documents to Buyer:
a) Signed  Commercial Invoice and
b) Full set of 3/3 original FREIGHT PREPAID shipped on board Bills of Lading and made to THE ORDER and BLANK ENDORSED.
c) Certificate of Origin;
d) Certificate of Quality and Quantity.  
e) Fumigation Certificate.
f) Phytosanitary Certificate.
g) Packing List.
Other terms, conditions and rules have to apply as per Incoterms 2010, GAFTA 88, GAFTA 125.

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Odessa, Ukraine 07th of October, 20_
Seller: Represented by Mr. _., Director, acting in accordance with the Articles of Association, on the one part, and
Buyer: Represented by director Mr. ___, acting on the basis of the Articles of Association on the other hand, have concluded the present Contract as follows:
1. SUBJECT OF THE  CONTRACT. The SELLER undertakes to supply and transfer to the BUYER the Barley in bulk, crop 20, origin – Ukraine or Moldova, year crop - 2011, further called the Goods, and the BUYER undertakes to accept the Goods and to pay it on the terms of the present Contract.
2. QUALITY OF THE GOODS. Quality of goods final at loading port as per Certificate of Quantity issued by GAFTA member inspection company appointed and paid by Seller in accordance with the following specification:
Test weight  61/62 kg/hl,
moisture max 14,5%,
admix max 2,0%,
Other grains  max 2%.
Sound, loyal, merchantable, free from of infestation and foreign smell. Free from alive insects and free from quarantine weed seeds.
3.    QUANTITY OF THE GOODS

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Contract No: Dated:
SellerBuyer
Have made this Contract whereby it is agreed as follows
1. Goods. Feed corn in bulk, crop , Ukrainian origin
2. Price and value. USD 0.00 per MT delivered Free On Board (FOB – Incoterms 2000) one safe berth of Kherson port, Ukraine with total value USD 000.00 +/-5%
3. Quantity. 5000 metric tons +/-5% at Buyer’s’ option at contract price. One shipment. Final at loading port as per Certificate of Quantity issued by GAFTA member inspection company at the Seller's option and account.
4. Quality. Final at loading port as per Certificate of Quantity issued by GAFTA member inspection company at the Seller's option and account in accordance the following specification as per standard EC824/2000:
Moisture : max 14.5 %
Broken: max 5 %

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Place: Date: Seller: Buyer:
1. Goods. Milling wheat in bulk. Origin any of Black Sea country.
2. Price. USD 0.00 per MT shipment at November; USD 0.00 per MT shipment at December; USD 0.00 per MT shipment at January; USD 0.00 per MT shipment at February; Delivered Free On Board stowed and trimmed (FOB – Incoterms ) one safe berth any Black Sea port.
3. Weight. 4 x 4,500 metric tons +/- 10% in seller’s option. Part cargo allowed/ Partial shipment not allowed. Final at loading as per Certificates of Weight issued by supervision company member of IFIA. Inspection to be ordered and paid by the Seller.
4. Quality
Final at loading as per Certificates of Quality issued by supervision company member of IFIA with following specification:
Test weight: min 78 kg/hl
Moisture: max 13.5%
Foreign matters: max 2 %

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CONTRACT dated August 8th, 20_
1. THE SELLER: 2. THE BUYER: 3. COMMODITY: Wheat Bran Pellets in bulk (hereinafter referred to as Goods), from crop 20_.
4. QUANTITY: 5’000 tons 10 % more or less at Buyer’s option. Weight is final at loading port as per Certificate of Weight issued by the first class super-intendent company at Buyer's choice and his expense.
5. QUALITY/WEIGHT:
5.1. Goods is sound, loyal, merchantable, free of foreign smell, alive insects, poisonous substances, quarantine objects not older then 3 month after production and corresponds to the following requirements:
Moisture: max. 14,5 %
Protein: min.  14,0 %
Fiber: max.   8,0 %
Diameter of pellets: 8,0–12,0 mm
5.2. Quality is final at loading port as per Certificates, issued by the first class superin-tendent company at Buyer's choice, order and his expense.
6. PRICE AND TOTAL VALUE:
6.1. Price of Goods delivered Free on Board Buyer's vessel  (FOB) under the Contract is USD 59.00  per one  metric ton.