Methods of transporting goods in international trade
Methods of transporting goods in international trade

خانه Methods of transporting goods in international trade

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Methods of transporting goods in international trade

Methods of transporting goods in international trade

In international trade, trade in goods is done according to custom and justice. The customs and habits of different nations are different and cause problems in international transactions. These problems can appear in different aspects of contract implementation. The parties to the contract are not aware of the customs and habits of each other and after concluding the contract, they face questions in which each has a different answer: how to procure the goods. ? Who is responsible for preparing the licenses, permits and customs formalities that are necessary for the goods to cross the border? The contract for the transportation of goods and insurance will be concluded by the seller or the customer and at what cost? Where is the exact place of delivery? How is the guarantee transfer? Under what circumstances will the seller receive the price of the goods sold? How will the packaging be done and who will bear the costs? How is the inspection of goods and their compliance and non-compliance with the promised goods and at whose expense? And what are the consequences?

Methods of transporting goods in international trade

Over time, the customs and habits of different countries take on a cohesive form, so that in some countries a standard answer can be provided for all the questions raised. It is later used in specific terms. However, these terms are common in different countries and due to the dispersion of the terms, the parties to the contract do not know and can not be aware of the exact extent of their duties and responsibilities in international trade. There are cases where such terms exist in two countries, each dealing with it differently, so that the limits of duties and responsibilities of the seller and the customer in one method of transportation vary from country to country: for example, Germany’s long-term performance on FOB shipping (.BOF) was more limited than in other Western countries: in Germany only the cost of shipping by FOB was borne by the seller, while in other European countries the risk was borne by the seller.

From the beginning of the twentieth century, with the rapid increase of international transactions, it was necessary to find the same answers to the same questions and to create a unified procedure in international transportation, which required more speed than before. To this end, various organizations around the world, the most successful of which was international trade, developed a set of international rules to interpret the most common trade terms in foreign trade.

The International Chamber of Commerce first collected the existing terms and a comparative study on the customs and habits of different countries, and by finding commonalities, brought them closer to each other and finally presented them to merchants as a set of coherent rules governing international transportation. It is an undeniable fact that international trade is not included, and at least once a year that chamber reviews the proposed set of rules. Since 1936, which was the year of the first publication of international regulations for the interpretation of commercial terms, it has been revised several times, the first time being in 1990.

International rules for the interpretation of international trade terms have been so successful that there is little contract in international trade that does not use one of these terms in relation to transportation, to the extent that its interpretation requires us to study the subject further. Article.

International shipping terms

The traditional method of international transportation is to transport any goods by air, land and sea to another country. The rules of the Incoterms of 1953 were based on this. In Incoterms 1990, a method has been adopted that does not only consider the distinction between maritime transport with different types of transport.
In 1990, Icotrums had seven common modes of transport between different modes of transport, including combined transport.
The seven types of transportation mentioned are:
1- WXE Summary of the word skrow xE means delivery at work
2- AGF “” reirraC eerF “” Delivery to the carrier
3- TPC “” ol diaP egairraC “” Shipping, paid up to
4- PIC oT diaP ecravitsni dna egairraC Freight and insurance paid
5- FAD “” retnorF ta derevileD “” Delivery at the border
6- UDD “” diapnU ytuD derevileD “” Delivery of paid tolls
7- PDD “” diaP ytuD derevileD “” Delivery of unpaid tolls

A. Delivery to the carrier

We divide these seven types of transportation methods into two categories and study them.
In these three ACF TPC .piC terms, we now describe the commonalities and differences.
1- Common funds
In the contract of sale, which refers to (delivery to the carrier), the seller and the customer determine a certain point at the time of concluding the contract that the goods will be delivered at that place.
In Mardakiyah, the point of meaning is not specified. The seller has the right to choose the appropriate point in the range in which the goods can be transported in Atyrau.
In this type of contract, the carrier is the person who undertakes in the contract to carry out the execution or pre-arrangements for the carriage by rail, road, sea, inland waterway, sea or a combination of these types. The customer may order the seller to deliver the goods, for example, to a non-carrier, in which case it is assumed that the seller’s duty to deliver the goods ends when the goods are under the supervision of that agent. To be placed.
Recently, in different countries of the world, the use of terminals for the transportation of goods has become the current method and its use has become common in transportation contracts. The term transport term in the International Chamber of Commerce rules refers to a railway station, freight station, terminal or container area, multi-purpose mixed terminal or any area dedicated to the carriage of goods.
In (delivery to the carrier), the seller, in addition to the goods, must prepare the black business or equivalent electronic message and the compliance certificates provided in the contract, receive the issuance licenses and other official licenses at his own expense and responsibility. Carry out the customs required for the export of the goods and bear all the risks of loss and damage to the goods until the time of delivery. How to deliver the goods is that the seller must deliver the goods on a specified date and place or at a normal time and place for such a purpose under the supervision of the carrier or other entities named by the customer. Deliver. Inform the customer in a timely manner of placing the goods under the supervision of the carrier, or possibly the carrier refusing to take delivery of the goods.
Goods that can be delivered are inspected, packaged, marked. The cost of those inspection operations that are necessary for the delivery of the goods to the carrier (size, weight, counting) is the duty of the seller, but if the customer wants with confidence. If he delivers more goods, he can inspect them at his own expense.
2- Cases of bookkeeping
In the different methods of transportation that (delivery to the carrier) is done, there are also differences, which are mainly related to the conclusion of the contract of carriage and insurance.
In the ACF shipping method, the seller has no mandatory obligations regarding the shipping contract. Of course, if the customer requests or the custom of the trade is on it and the customer does not give an order to the contrary, the seller can conclude the shipping contract according to the usual method with the responsibility and cost of the customer.
In contrast to the TPC (ot diaP egairraC) shipping method, the seller is obliged to conclude the contract of carriage of the goods to the designated point at the designated place at the designated place with normal conditions, at the usual route in the usual way, if the item If there is no agreement, the seller can choose the point that is most suitable for him in the designated place.
In this type of shipping method, as in the case of ACF (reirraC eerF), the seller has no obligation to insure the goods.
In the case of transport method pic (ot diap ecnarusni dna egairraC) the seller, in addition to concluding the contract of carriage in the same way .T.P.C is obliged to conclude the insurance contract at his own expense.
The details of the insurance contract are agreed in the main sale contract, but according to Incoterms, the insurance must be concluded in such a way that the customer or any other person who has an interest in the commodity insurance can directly claim damages from the insurer. Or reputable insurance companies are concluded and the minimum insurance coverage is in accordance with the terms of the London Institute of Insurers.
As can be seen, the difference between shipping methods (delivery to the carrier) is that, in the ACF shipping method, the seller is not obliged to conclude the contract of carriage and insurance, while in the TPC shipping method, the seller is obliged to conclude the insurance contract and the shipping contract at cost. It is itself

B – Delivery at the border

In the method (delivery at the border) in the contract of sale, a certain point at the customs border of the neighboring country is determined that the seller must deliver the goods at that point. The seller’s obligation ends when he clears the goods for export from the customs of his country and makes them available to the customer at the designated place.

1- Sharing funds
Three terms “PDD.UDD-FAD” from the terms Incoterms 1990 are assigned to the delivery of goods at the border.
The term (border) is general and therefore is used for any border, including the border of the country of export. Can be used.
In different types of methods of transportation and delivery of goods (border), the seller must prepare the goods and business list or equivalent electronic message in accordance with the contract of sale and prepare other certificates of conformity that the contract may require, licenses, and other certificates of conformity that may Prepares the necessary contract, obtains licenses, permits, and customs formalities that require the export of goods at its own expense. If the goods are to pass through a third country, the seller must carry out the customs formalities for the transit of the goods. Payment of shipping costs and concluding a contract to transport the goods to the designated point is another duty of the seller. After performing these formalities, provide the goods to the customer without any action regarding insurance, with delivery documents such as document, shipping or equivalent electronic message at the specified place of delivery on the specified date or time. Any failure to perform these duties will result in liability.
In the case of (delivery of goods at the border), Incoterms has designated a point where the responsibilities of seller and customer intersect. Up to reaching the point of delivery, all costs related to the goods and their transportation and the costs of performing the necessary customs formalities for the goods and all responsibilities for loss, destruction or damage to the goods are the responsibility of the seller. From that point on, the seller has no responsibility for the goods and his obligations end with the correct delivery. This is the end point of the seller’s obligations, the beginning point of the customer’s obligations. Only in the case of the obligations of the seller or the customer, as the case may be, the responsibilities will be extended after or before the point of retaliation if they have failed. For example, in some cases, the seller is obliged to determine the date or place of delivery of the goods and inform the seller in a timely manner. It is for sale.

– Differentiation cases
The differences between the three methods of transportation (delivery of goods at the border) are mostly related to the point of delivery of goods, which, depending on the case, in the country of sale after clearance but before the customs border of the neighboring country or in the country of entry after customs and Or it is done at a certain point inside the importing country.
Delivery of goods at any point of one also includes costs related to the goods up to the point of delivery. These costs, in addition to freight, packaging, marking, etc., which are related to the goods themselves, also include costs related to the destruction or damage to the goods.
In the FAD shipping method, the sale of the goods ends when the goods are cleared for export and delivered at the designated point and place at the border, but before the customs border of the neighboring country. This term is mostly used in rail or land transportation and is applicable to any other type of transportation. Here, the intersection of the duties and responsibilities of the seller and the customer is the point between the two borders of the neighboring country. In order to reach this point, the goods must necessarily pass through another country. In this case, the related costs will be borne by the seller. By giving an example, the issue becomes clearer:
Suppose an Iranian trader buys goods in France and cites the FAD shipping method in the contract. In this case, the French merchant, after performing all the formalities that require the goods to leave France and transit through different countries. Must deliver the goods at the border, after passing and clearing the goods through the Turkish customs and before entering the Iranian customs.
The second type (border delivery) is UDD, which, as we have said, is an abbreviation of the term (diapnU ytuD derevileD). In this type of shipping method, the seller’s duty on delivery ends when he delivers the goods to the customer at the designated location in the country of entry. The seller must conclude the contract of carriage with the carrier after preparing the goods according to the contract and obtaining the licenses, licenses and formalities (customs). On the due date, by accepting the responsibilities of loss or damage to the goods and payment of costs at the time of delivery and timely notification of the buyer and preparation of delivery documents, inspect the goods and pack the goods at the specified date or within the deadline after crossing the border without payment Provide duties, taxes and other formal expenses payable on arrival upon payment of the said customs formalities.
The customer is responsible for paying the official costs of importing goods such as tolls, taxes and other official expenses, just as specified, the cost of performing the formalities is borne by the seller. However, in contracts, the term U D D is sometimes used in addition to, for example: “:
(noitanitsed fo ecalp demaN) TAV UDD
The application of this type of addition indicates the agreement of the parties to impose official costs and some taxes, such as value added tax on the seller. The result is that if the UDD is applied without surcharges, the seller’s obligation on the goods will end without payment of customs duties and other taxes and official import duties. However, if the parties wish to impose on the seller some of the costs payable upon arrival of the goods, they must explicitly stipulate in the contract. Inside the territory of Iran at the border of Bazargan, without paying taxes, taxes and official salaries of Iran, and by paying the cost of performing these formalities, they must deliver all the expenses that have been accrued to Berkala so far.
Therefore, the difference between FAD UDD is in the same delivery of goods at the border point. Which is done in FAD before crossing the Iranian border and in UDD after crossing the Iranian border.
The third method of transporting (delivery at the border) paid tolls (diaP ytuD derevildD) is PDD. The meaning of this term is that the seller’s duty regarding the delivery of the goods ends when the goods are delivered to the designated place in the country of entry by paying all the costs mentioned in raising the UDD and taking the same guarantee and providing the same Deliver the documents and documents within the country at the place specified in the contract. In this type of method, the seller is responsible for transporting duties and customs duties and other formal and informal costs.
In the above example, a French trader who has a contract with an Iranian trader for the delivery of Qazvin PDD in front of the factory with a specific address, the seller will not be performed unless the goods are in front of the specified factory in the customer’s office.

The difference between this type of shipping method and the previous shipping method is in transporting goods from the Bazargan border to the factory in Qazvin, which has been identified as a delivery point. The transfer of the delivery point of the goods from the border of Bazargan to the front of the factory in Qazvin includes the payment of shipping costs and the acceptance of risks and responsibilities and the necessary costs for the work to be done by the seller.
In short, comparing these three methods of transportation, we can see the difference in the rate of progress to the destination of the goods, which the more progress is made, the heavier the duties and responsibilities of the seller.
In the combined transport of land, air, sea rail, there are two terms in the two ends, the method of transport, in the method of transport WXE for short (skroW XE) means (delivery at work) goods in the country of sale and at his workplace or factory and Or the warehouse belongs to him. In the PDD method, the goods must be delivered at the other end, ie at work or in a place in the buyer’s country.
In Incoterms 1990, the following six terms are assigned to shipping by sea:
1- SAF acronym (pihS edisgnola eerF) means delivery on board
2- BOF “” (draob no eerF) “” Delivery on deck
3- REC “” (thgierF dna tsoC) “” Shipping cost
4- FIC “(thgierF dna ecnarusni tsoC) paid shipping
5- SED “” (pihs XE drevileD) “” Delivery from ship
6- QED “” (yauQ XE drevileD) “” Delivery to the dock

Of these terms, we study the three most closely related terms B.O.F, R.F.C-FiC in paragraph A, and the other three terms in paragraph B.
A. Loading on the deck of the ship
The similarity of the three terms .B.O.F, R.F.C, F.I.C is that all three terms of delivery of goods take place on the deck of the ship.
(Delivery on deck) means that the seller’s duty to deliver the goods ends when the goods have passed the ship’s railing at the designated port.

1- Common funds
In this type of transportation methods, the seller must provide the goods and the equivalent business list or electronic message with the certificate of conformity of the goods that will be delivered to the promised goods. After inspecting the quality and quantity of licenses, obtain the issuance or other licenses required for the export of goods. He is also responsible for performing customs formalities for its issuance and cost.
After preparing the goods and solving all the problems related to its issuance as described, deliver the goods on the specified date or within a certain period of time on the supply of the ship determined by the customer, according to the custom of the port of loading. Inform the customer about the delivery of the goods in time so that he can prepare for the delivery of the goods.
Delivery of goods is accompanied by documents that will also provide those common documents for the customer. In the shipping method (delivery on deck), the intersection of responsibilities and duties of the seller and the customer is the passage of goods through the ship’s railing. Until it reaches the point of delivery, ie the ship’s fence, all costs related to the goods and its transportation and the costs of customs formalities required for the export of goods and the value of the necessary documents are the responsibility of the seller. He is also the guarantor of the poor or the extinct or the damage to the goods. From that point on, that is, from the moment of passing the fence of the ship, the seller has no responsibility for the goods and with the correct delivery, the seller’s responsibility for the delivery of the goods ends and the transfer of the guarantee is done.
This is the end point of the seller’s obligations, the beginning point of the customer’s obligations, and only in the case of the seller’s obligations will a sample be extended, as the case may be, before or after the goods have passed the ship, who have failed to perform their duties. For example, in a B.O.F shipping method, the customer must inform the seller of the ship name, point of loading, and time required for delivery in a timely manner. Now, if due to the customer’s negligence, either the designated ship does not arrive on time, or arrives sooner or later, and as a result the ship is delayed in port, the customer is responsible for paying the delay fee even though the goods have not yet passed the ship fence. Shipping and other costs will be. Conversely, if the seller is hesitant in preparing the documents and as a result the goods are damaged, the costs will be incurred even after the goods have passed through the ship’s railing, the payment will be at his disposal, even if the goods have passed the ship’s fence.
In these types of shipping methods, in addition to the main obligation, which is the delivery of goods and payment of the price, the seller and the customer must provide all the necessary documents for the export or import of goods from their country or to the country.

2- Cases of differentiation
In the methods of transportation (delivery on deck) there are also different cases, which are mainly related to the same contract of transportation and insurance.
In the case of sale with the .BOF shipping method, the seller completes his duty of delivering the goods by passing the goods through the ship’s railing, by fulfilling the points mentioned above, and delivering the goods on the ship’s supply, and has no duty regarding the shipping and insurance contract. He has entered into a contract to transport the goods and he has sent the ship for loading at his own expense.
In the RFC (freight cost) method, unlike the BOF shipping method, the seller not only has to deliver the goods on the deck of the ship as stated, but also at his own expense, the contract of carriage to the specified port of destination with the usual conditions and on the route Usually concludes with a type of seagoing ship normally used to carry the goods subject to the contract.
Regarding the .BOF shipping method, the characteristics of the ship are not listed and the customer is free to send any type of ship he wants to transport the goods that belong to him, but if the ship is not able to load the goods and in this case the damage to the goods or the ship is responsible. It will be. Contrary to the method of shipment to the R.F.C. The ship must move normally and in the normal direction and be suitable for transporting the goods subject to the contract. It should be noted that in this method of transporting R.F.C, the duty of the seller is heavier than the previous type of B.O.F.
In the third type of shipping method (delivery on deck), ie FiC (cost, insurance and freight), the seller’s duties, in addition to what we mentioned in general, is to conclude a shipping contract, as in the case of the B.O.F (FOB) method, and in addition to that, marine insurance. That is, it must insure the goods against the risks it faces, whether on suspicion of loss or damage to marine insurance.
Note the type of insurance (governor) provided by the International Chamber of Commerce, but it is not boring to repeat it.
In the FiC transportation method, the seller concludes an insurance contract with the insurers or a well-known insurance company at his own expense. The amount is the minimum insurance coverage (conditions of the London Insurance Institute) unless otherwise agreed in the contract. The coverage period is from the start of the voyage until the arrival of the goods at the destination port. This type of insurance is mandatory and the cost is borne by the seller. However, if the customer requests, the seller insures the goods at the expense of the customer against risks outside the scope of marine insurance, such as wars, strikes, riots and riots.
In the open FiC shipping method, the seller’s duty is heavier than the previous two methods, and in addition to concluding a shipping contract at his own expense, as in the shipping method, he must insure the goods against risks. Therefore, the range of seller tasks is minimized in the BOF method and maximized in the FiC method.
This reduction in the liability of the buyer and the increase in the liability of the seller in the methods (delivery at the port of destination) also continue.

 

B – Delivery in the destination port
In two types of shipping, delivery is done by sea in the port of destination.
1- Delivery from ship pihs xE derevileC “SED
(Delivery from the ship) means that the duty of the seller in the case of shipment of goods ends when the goods are provided to the customer on the deck of the ship before clearance for entry into the designated destination.
The seller is obliged to provide the goods according to the contract of sale, licenses, licenses, export formalities and pay the necessary costs until delivery and with shipping documents or equivalent electronic messages after inspection, packaging and marking on the specified date. And deliver the specified deadline on the deck of the ship. In this type of transportation method, the contract of transportation is concluded by and at the cost of the seller. Delivery conditions are such that it is possible to transfer goods from the ship by unloading equipment. After the departure of the ship, the seller must inform the customer of the approximate time of arrival of the ship.
What distinguishes this method of transportation from the previous three methods of sea transportation is the moment of delivery of the goods, where the moment of crossing the ship’s railing was in the port of origin, and here the deck of the ship before clearance in the port of destination
In this type of shipping method, the seller is not responsible for insurance and if the customer wishes, he can insure the goods, otherwise he must accept the possible risks.
Delivery at QED dock “xE dereviliD”
It means (delivery at the wharf) means that the seller must clear the goods at the wharf (reloading) of the port of destination designated for entry and provide them to the buyer. In the contract of sale, which cites the delivery of the goods to the place of arrival. ytud, in the same way it is possible to exempt the seller from paying other fees.The VAT is often the subject of discussion and in case of exemption of the seller from paying it the phrase yauQ xE derevileD dia [nU TAV is used.
The difference between this method of transportation (delivery at the wharf) and the previous method (delivery by ship), as observed, is at the point of delivery of the goods, which entails an additional cost for the seller.
Therefore, in the shipping method, the minimum responsibility of the seller is in the SAF method (delivery on the ship) in the port of origin and the maximum is in the QED (delivery at the wharf) of the destination port.
Conclusion – The methods of transporting goods in international trade are logically organized by the International Chamber of Commerce. In a way that in terms applicable to different types of transport (land, air, rail, sea and combined) and in terms specific to sea transport, the more we move from the point of delivery of goods from origin to destination, the heavier the seller’s obligations and Customer commitments become lighter.
In the term movement from the origin, which is at the top of each group of applicable terms in different types of shipping and special shipping terms, the obligations of the seller and the customer are almost the same.
In the WXE method, the seller’s obligation is to deliver the goods to his factory or workplace, just as in the SAF sea freight method, the seller delivers the goods by ship in his own country.
In the two terms of arrival at the destination, which are at the end of each of the two groups of terms that are applicable to different types of shipping and terms for shipping, the obligations of the customer and the seller are the same.
In the method of transporting goods by POD, the goods are delivered to the customer at the specified location in the country, and in the same way, in the pihs xE method of sea transport, the goods are delivered outside the ship after shipment to the destination.
In addition to this internal logical order, the rules of Incoterms are also economically regulated in accordance with the rules of supply and demand of goods.
The higher the demand for goods and the lower the supply, the closer the choice of the term to transport the goods will be to the origin of the movement. To meet your needs. Conversely, the lower the demand for goods and the greater the supply, the customer’s lack of need for goods and the need for the seller to sell will cause the seller to be willing to accept shipping costs, risks, rent and other formal and informal costs and hence the term Will be closer to the destination.

Author: persian / Date: 2017-10-26
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