CAVEO

TERMS OF REFERENCE: UFCI

Education: Advice for End Buyers, Supplier and USCT Members 

5 April 2017

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ITB

INQUIRY TO BUY (ITB) is in general, a letter of introduction, offered by a USCT member when sourcing products for the its principal and buyer  or FTN Exporting (If attached to such). It also may be used by an USCT member who is acting as principal in their own name when enacting  with its own trading group (Meaning that no association with FTNX is apparent ).Like all documents served by FTNX, an ITB is advised in PDF form with a few lines of added text applied in the email section stating what the PDF is about. Suppliers world wide receiving an ITB are encouraged to open it and read its contents. The USCT number and name of the member (or Logo) should also appear in the email text. The name, USCT number and email address appearing in the PDF should also be the same as per the email details as apparent when the PDF was advised. If the header of the PDF carries FTN Exporting details, or if FTN Exporting is mentioned as being the principal ‘buyer’ in the opening paragraph,  then  the ITB has been advised on our behalf. PDF should be cleanly and clearly presented and have no alterations to indicate that an unmarked original ITB has been served. An ITB may also carry general reference about a certain product that FTNX  may need to buy in any given ‘year’ rather than ‘immediately.’ The supplier may respond to the ITB, or it may simply file it away, and use the advice therein, should goods be offered to FTNX at a later time. The supplier must return reply by email to the USCT member serving the ITB and many not come directly to FTNX when such goods are being offered.The USCT member will then fill in the required details of what is on offer onto an OTS form for submission to FTNX, unless such is acting as a principal in it own name. These ‘paper trails’ offer a benefit not only to the USCT member, but to a supplier as well, in settling any concerns out of the way quickly and  amicably, long before a situation escalates, as some transactions can take a long time to arrive at a final conclusion. Recalling what was ‘agreed upon earlier’ with good intent,  often settles any pending  disputes, or angst, sooner rather than later. An ITB on its own has no legally binding status.  

 

MOU

MEMORANDUM OF UNDERSTANDING may be served alone or with another document or in support of a situation yet to eventuate. An MOU is an agreement between parties, in where one party is asking the other for a service, and in where upon such a service being granted or ratified, the parties enter into a formal arrangement; as dictated under the MOU. Generally the ‘MOU’ on its own has no legally binding status, but could become a broken ’agreement’ if one party successfully at their expense, has initiated the requirements of the MOU where the other party reneges on what was agreed upon. Ideal for large construction investment and resources projects rather than a large commodity transactions. The MOU offers the basis for parties, to pre-advise what the expectations of each party to the MOU are in where, once such expectations are realised by one party–the other party continues to honour previously agreed upon understandings. Typically a principal such as FTNX would produce the MOU and allow its agents  to source parties who may be interested in what the MOU offers. FTNX or its Agents may not seek ‘investments’ as we are not licensed security brokers or advisers, but project creation ‘specialists.’ Such ‘specialists’  may create ‘investment projects’ in where the investor must seek it own experts to consider such; if the project is accepted the project is purchased outright, by the principal, who now must abide by statutory laws and regulation  regarding inception of a prospectus or IPO. If the advice of the carefully crafted and guarded project later turn out to be false, criminal proceeding against the producer may be called for. Once the project is purchased all guarded (undisclosed) details must become ‘disclosed’ at that time.

  

AOS

ASSURANCE OF SUPPLY (AOS) is an informal offer, advised by the supplier to the UFCI via the buyer FTNX, the kind of  informal offer, yet to be made ‘formal’ offer, at a later date, as per its basis. The AOS has no legally binding status if not acted upon. A supplier who has a large stockpile of goods, or who is awaiting a large harvest in the future, may seek to ‘assure’ goods to a buyer like FTNX, as early as possible at an agreed upon reasonable best price. FTNX must pay the ‘producer’ a better rate than the offered best (lowest) price indicated on the AOS, accordingly the goods are placed on the UFCI in where, when FTNX is ready to buy such good a better price is offered than sought by a factor or 1.0% per Metric Ton or unit but under 3.5% of the actual price of goods offered. The better ‘Indexed Price’ then becomes a benchmark price for others who are producing the same product around the world. In effect the supplier producer is testing prices and trying to secure a buyer before harvest time; or before stockpiles held become even bigger. Only very large single shipment quantities  are considered, in where large monthly revolving quantities are preferred.FTNX will even consider a whole harvest or warehoused quantity of goods in where the supplier assures FTNX that the good quantity offered will fall within a 10% tolerance factor either way.  Whether or not FTNX  eventually  buys such goods does infer that the producer remains at liberty to sell such goods at harvest time to his own end buyers. Accordingly FTNX must buy such good at the best offered price, before a declared harvest time by making a ‘formal offer’ in line with that was stated on the AOS, to which the supplier or producer accepts. For stockpile goods already in storage, an AOS for 30 days or longer must prevail as its validity date, in where the supplier may extend such in 30 days increments ( at the same price or different price originally offered) or cancel the supply assurance given outright. The formal offer once signed legally binds all parties to now perform. The supplier now advises the sales contract to FTNX (unless our copy is sought.) Once the contract is signed, FTNX must initiate the required financial instrument within 7 days, thereafter,  in where 1st delivery is ready to commence 30 days (or more but not less) or as agreed on the contract. Supplier may ask any USCT Member or FTNXNET Agent for a sample ‘AOS’ form, to start this above said UFCI listing process. In essence  FTNX tests the market place, the ‘value’ of the offered product against its ‘worth’ to willing end buyers; in where a part of the new prices secured is retuned to the supplier.  

 

RFQ

REQUEST FOR A QUOTE:(To Buy From FTNX) A disclosed end buyer contacts a USCT Member (or FTNXNET Agent)  by email  asking them if certain goods can be sourced for them by the UFCI at a declared  reasonable target price, delivery mode and quantity. The end buyer provides all details sought by the FTNX USCT  member via email ,who then fills in a form called a RFQ (Request for a Quote) and when completed, forwards the RFQ to the FTNXNET Agent they have attachment with for further checking. If accepted, the RFQ is advised to FTNX who posts the goods needing to be sourced as buyer. FTNX then through the same string make an offer with the actual price we managed to secure as seller, for the end buyers further consideration. Acceptance of the offer is legally binding in where the goods are purchased by the end buyer from FTNX.

 

OTS

OFFER TO SELL: (Offer To Sell to FTNX) A supplier who have been interacting with a USCT Member or FTNXNET Agent  for some time, wanting to submit goods for our purchase consideration, or a supplier coming across the FTNX website by chance, makes contact with the representative advising what is being offered by email.The representative obtains a form called an OTS and commences filling in all the required details in where once filled in the OTS is again as per the RFQ process submitted to  FTNX for it  purchase consideration. Validity on such goods falls on similar ground and per the AOS where once a purchase is ready to be made, and offer is advised by the buyer FTNX, for the supplier to consider and if accepted, the deal moves forward  to contract stage until failure or success is recorded. Over the years FTNX has received many offers which required a great deal of time to secure information needed-that was missing in the original offer advised.The OTS stop this issue, as it will only be submitted to FTNX when all the required information is secured. 

 

IPG

IRREVOCABLE PAYMENT GUARANTEE is a form used in house for any promise of payments make outside the bounds of a contract or offer, such as commission payments or rebates. The IPG is sent out to each person entitled  to such payments once the contract between the parties  to the sales contract has been completed. The actual payment as promised on there IPG is advise upon each successful delivery in where each person holding a IPG is then required to submit a Pro-forma invoice for services rendered, or rebate due, in where payment as promised on the IPG is then made into the persons bank account as apparent on the pro forma invoice by SWIFT. The IPG must be accurately advised and no alteration may be made. The payment promises is an irrevocable one; once delivery has been successfully initiated; payable within 7 days thereafter of each clean delivery.Usually used for payment of Commission to agents and to end buyers and supplier as a rebate for matter of performance, or  lack of performance by a seller (LDD) and the likes.

 

ICC INCOTERMS 

The obligations of the principals to a transaction are dictated by Incoterms delivery rules which clearly define the obligations of the  parties to a contract, as it pertains to the delivery mode used and the allocation of expenses therein.UCP Banking rules apply for all Financial Instruments being used. URC Collection Rules apply when payment are being claimed (bank to bank) after the ‘collection’ process has been completed. English Rules of Agency and Trade dictate matters of contract formation which provides support for foreign transaction and governance therein world wide.

 

ICC UCP and URC

International Chambers of Commerce Paris, France, long standing universal current rules of delivery (Incoterms 2010) Collection (Uniform Collection Rules 522) and Payment ( Uniform Custom and Practice for Documentary Letters of Credit  Publication No 600) are all observed by FTNX. When FCA, CIP, FOB, CIF, CFR,CPT and FAS delivery terms and the likes are used, then such rules as specified under incoterms as stated on the offer and contract prevail. Incoterms can also be used in local business or interstate business so long as such rules are expressed on a contract. UCP  Rules apply  in relation to  the issuing of  a Irrevocable Documentary Letter of Credit, which is a conditional instrument,  so long as the IDLC is endorsed as adhering to UCP Rules as current at the time of issuance. A UCP 600 or ISBP SLC are financial instruments that must never be sought from end buyers, or  used to pay for goods from suppliers as such are unconditional instruments and are used in matters of P.G of payments or perhaps ‘ready to unload’ SPOT cargo which FTNX does not deal in. URC Rules are bank to bank remitting rules, applied after  the supplier seeks collection on a (UCP endorsed) financial instrument (DLC) in where remitting procedures from suppliers bank to buyers bank are also settled to complete the IDLC collection process. FTNX applies / adheres to all such rules in all commodity transactions  to  ensure  safe, transparent dealings are alway apparent.

 

INTERNET TRANSACTION

International commodity deals and all business conducted on the internet  are called ‘instantaneous deals or contracts.’ Doing business of the internet / email  is a risk laden application, full of scams and fraudulent dealings, and not confidential; must be presumed from the start. With such  presumptions in place, parties to deal transact up to a certain level. Once this certain level has been reached, the transaction leaves the internet in where hardcopy documents MUST apply; is the only prudent method of trading using the internet. Emails are also readily being taken by many courts in many countries to be  ‘evidence’ of a pre-existing intent of parties entering a deal leading to contract.

 

BUYER AND SELLER DEFINED 

Caveo Risk Management and FTNX are not  an Intermediaries, Agents nor Brokers ; we act far beyond that scope as specialists. We are ‘Buyers or Sellers’ of commodities at any given time. No matter what status a principal holds or claims when offering goods, we are only able to conduct  business with a ‘disclosed supplier in possession of goods.’ A person who is connected to a ‘supplier’ therefore is not a ‘disclosed supplier’ under FTNX rules of trade and business practices.We cannot do business with such entities. A person doing business with a ‘disclosed supplier’ buying goods from such is legally defined as a ‘buyer.’ A buyer is not a ‘disclosed  end buyer taking possession of goods being ordered.’ A person connected to an end buyer is therefore not a ‘disclosed buyer.’ FTNX is a buyer purchasing goods only from disclosed suppliers. FTNX is  seller of such goods  to a disclosed end buyers. Therefore FTNX is acting in a lawful and legally defined manner, when buying and selling goods on ‘behalf of ‘undisclosed’ end buyers and suppliers’ so long as this undisclosed position is apparent on any business being conducted.  An Illegal act becomes apparent when a buyer/seller serve the impression to be able to sell goods it does not have to offer in the first place, in where once an end buyer is secured, the seller attempts to source such goods at that time. An offer made, for goods not secured or purchase prior to the offer released is a criminal act of fraud. FTNX Exporting is legally defined as a ‘buyers and seller’ of commodities acting on behalf of undisclosed others. FTNX is leading foremost expert in the nature of business is applies. It does so under the legal maxim of ‘Uberrimae Fidei’ defining further to mean; on the fullest confidence; in that the offer and the advice on such is given, as it supports the same goods being sold as secured or purchased by the seller making the offer, to the end buyer as apparent before the offer to the end buyer was made. Documents supporting ‘proof’ that goods are secured, as it pertains to another deal, presented by way of a current offer, is also an act of criminal fraud. Only the goods being ‘ordered’ can support such ‘proof’ in documentary form,which cannot be provided until the ordered goods have been independently inspected prior to loading or are on board a named vessel. FTNX specialises in large NBC contract.Our business is both sophisticated and very demanding. At times if FTNX is asked to actual represent a Supplier,(not a preferred position) FTNX would be  acting ‘on behalf of a disclosed principal’ as it official agent or broker. Under this not often considered trading aspect, we must disclose who our principal is-otherwise, the ‘undisclosed’ position prevails for most of the time. An end buyer  wanting  the release of a PPIC disclosing a our supplier or verifying the goods we have secured or purchased as offered, before placing the order, must submit a deposit in where the PPIC is then released. If the end buyer fails to complete the order, the deposit is forfeited for lack of performance.  In short, FTNX is a legally defined Buyer and Seller of commodities in our own name; we do not disclose form where we buy our goods from, until a transaction is first secured.

 

QUOTATION

A quote may be given to an end buyer, or a quote may be sought from a supplier in possession of goods. A quote has no legally binding aspect. A quote once accepted by the end buyer taking possession of goods, means that the entity is simply ‘confirming’ the quote. Once a quote is confirmed, an offer may be released. The quote deals mainly with delivery mode, quantity, grade and price. Once the price is confirmed as acceptable, then a more detailed offer may follow. FTNX does not issue quote, as we have our quotes posted on the UFCI boards, but our USCT member may offer quotes instead of an ITB to potential end buyers on our behalf. Once a quote is returned as confirmed from a USCT member, FTNX  prepares the offer, and issues it to the same USCT member, for forwarding to its client.

 

 

OFFER TO PROCURE (OTP)

FTNX when sourcing, does not use ITB’s. An offer to procure stands on a similar ground as an MOU except it’s a formal document. Everything that a supplier needs to know about what we are seeking to buy, is defined on the OTP. If the supplier accepts an OTP, then  once FTNX  is ready to buy the transaction commences with FTNX issuing a formal offer to purchase goods as explained on the OTP. An OTP is a document that  defines long term supply of a particular product being being sought by the buyer FTNX. If the OTP is not accepted its rejected, in where the supplier may make changes and make a counter offer. A very large quantity of goods are offered where FTNX draws smaller  shipment lots and places orders where such goods are shipped to different countries, as needed.

 

OFFER

An offer issued by FTNX to an end buyer is a formal document in where unless stated otherwise, it’s legally binding once accepted by the end buyer. Everything on the offer must be made clearly apparent on the subsequent sales contract. If any part of an offer is changed, it’s a rejection of an offer. On a rejection,  negotiation may commence once more, if we can appease the end buyers concerns; a  new transaction code is made  apparent, and a new offer is sent out to the end buyer with a sellers invoice. FTNX's position on is matter is clear. If the offer is rejected for the second time, then a third and final offer will be advised, where if accepted, it must be retuned with a deposit as specified on the pro-forma sellers invoice. The PPIC will also be released once the deposit is accepted ( Quid Pro Quo: Something  for something to show our good intent.)  If the end buyer attempts to breach or cancel the offer and / or contract, the deposit will be forfeited due to the end buyers ‘lack of performance and good intent.’ It takes up a lot of our time to service end buyers whose intent becomes questionable. An end buyer ought to be ready to make the purchase if a second amended offer is advised, to receive a second offer rarely happens (let alone a third). We attempt to seal all business with the first offer as the  ‘best’ offer basis  we can make. An offer without a price means no offer is in place and that no binding contract can become legally incepted. An accepted offer must be apparent before a contract is signed. 

 

CONTRACT 

A contract is defined as (a spoken or) written agreement, meant to legally bind parties to such. Parties to a contract have agreed to become legally bound as per its terms and conditions. To FTNX the contract of sale is a mere formality when compared to the offer which in itself is also an agreement that must be executed with great diligence and skill. Incoterms specifies who is responsible for what expenses, including freight, and wrong entries on a contract cannot over-ride  incoterms  on such matters. Like wise matters of payment are dictated by UCP Rules, in were apparent, wrongly made contracting terms which override UCP cannot be effectively tested. Unconscionable or unjust contracts terms or self inducing ‘frustrating’ contracting terms cannot be effectively or readily challenged.The contract supporting UCP and indeed incoterms delivery modes have arrived at a high level of standardisation and expectation, that  the contracting terms itself often offer no challenges or concerns to FTNX or its end buyers–when advised by FTNX. We cannot state the same of the many poorly applied, and flawed contracts offered to us, by suppliers, as often made by their own lawyers;  many who believe that the longer the contract, the more protective and binding it becomes. Not so ! The law books a full if litigations because lax or over bearing terms applied on contract had created loop holes.A FTNX purchase contract rarely exceeds 20 pages.  The more terms of reference you place on a contract, the more  it  can become exposed to possible challenges, in where more ‘loop holes’ could inadvertently  be created, when a deal goes awry. The offer and the start of the deal is the most important  aspect of the deal and not the signing of a good sound contract, as many believe.This is the reality of trading for 30 years and the experience gained therein; contrary to what many ‘academic publications’ infer.

 

PAYMENTS BY IDLC

All payment for goods ordered from FTNX or when goods are purchased from the supplier initiate the issuance of a UCP 600 endorsed  Irrevocable Documentary Letter Credit. When a revolving transaction is in effect the payment is advised as ‘non cumulative’ revolving supporting the whole contract value as per its expiration date. A person who has no money ( Who is not Ready Willing and Financially able; RWA) cannot issue a Bank Endorsed DLC. Such a person should have not attempted to make a purchase  or place and order to begin with. We do not accept any other payment methods as a matter that is of utmost security. The goods when delivered cause documents to be presented in a clean state; that is, in an unmarked and unaltered state; not qualified in any manner– as per the documents specified on the credit. Once all the required documents are cleanly presented, the bank issuing the credit, or the bank advising the credit (If confirmed) sights (at sight) such documents and if they comply with the terms of the credit, the supplier may proceed on the collection process which will be completed within 5 banking days. If the documents don’t comply, then no payment can be secured, until such time the required discrepancies / concerns are rectified. Only a person who is financially able can have a credit issued by their bank, which must be a highly ranked bank of the world, (top 100) otherwise the credit will need to be advised with the added conformation of the sellers bank being applied (at buyer added expense) or another bank that is able to correspond with the sellers bank. In which case, the transport  documents need to be presented to the confirming bank and not the buyers issuing or advising bank. FTNX requests that a transferable credit be advised, with all transfer fees ‘as agreed upon’  on the offer, to be paid by the end buyer. This means the DLC will have partial payment  being marked ‘as allowed’ or the end buyer  advises a SWIFT payment to the bank of the seller, when the DLC is advised. This is the simplest straight forward transaction. If a TIDLC is not advised, then a normal ‘Irrevocable’ DLC may be accepted by FTNX in where it must be advised as confirmed.This make for a more complex transaction.These aspects are all in line with universal UCP banking rules, that FTNX adhere to as well.In House UCP endorsed credit are credits made by corporate entities not banks (allowable).The In-house credit must be supported by a bank issued confirmed credit, already in the bank account of the issuer.FTNX does not accept IH-IDLC but may issue one in very special circumstances.The bank advising a UCP endorsed credit will irrevocable honour its obligation pertaining to payment if document comply, because the honourable standing  of the bank is what is being tested as it stands with other banks and because  it can only ‘honour’ to ensure payment as opposed to ‘guarantee’ payment because unlike the unconditional aspect of an  SLC, a DLC is a ‘conditional’ instrument subject to certain acts being performed, before final payment can be ‘guaranteed.’ This is why an ‘SLC’, ‘Bank Guaranteed’ or payment by SWIFT/Cash  cannot (should never) be used to pay for export ready goods.The ‘Irrevocable’ status of a DLC cannot be revoked once issued; and such a Buyer ties up a lot of money, for a long period of time,  if it enter into deal where  there are continual delays or where eventually no goods are apparent:even here the credit will not be revoked until its expiration date.The irrevocable status on a credit however can be revoked a verifiable fraud has taken place; once evidence is surrendered  roving as much to the issuing bank. If goods are not ready for first delivery and consequently it comes to light  that no goods were available, criminal charges laid against the seller (whether apprehended or not)for fraud would distinguish the irrevocable status of the credit.For all the myths and stories we have heard about the usage of a DLC, the simply fact of the matter is this, a person who is not RWA will not be able to open a credit signifies that the seller must be convinced that the end buyer is capable of making the purchase ; and the only way to be 100% sure  that such purchase is able to take place  is for the seller to ‘test’ the deal all the way to the end of the transaction; after all the supplier loses nothing except a little time, against  the potential of a huge sale. Should no DLC be lodged once the contract is signed by the buyer, the supplier could still  sue an end buyer for loss of not just the sale, but of anticipated profits as well.The end game of any deal suits the supplier intently as no goods will be made ready for export, unless an accepted financial instrument is in place long before 1st delivery is made. All the nonsense we have seen  and heard about such matters above, as often initiated by poorly informed banks, suppliers or end buyers have been incorrectly served, and continues to be incorrectly served to this day. The excuses we have heard about the issuance of a UCP endorsed DLC have been ongoing since we started in this  business  nearly 30 years. Poor training and education is the main reason such misinformation  subsists; something that FTNX has been trying to remedy for a long time. The message is getting through, albeit–at a slow pace. 

 

PERFORMANCE GUARANTEE (P.G): LDD

LATE DELIVERY DISCOUNT is another long tested FTNX created aspect , that may be used via  USCT members initiated deals or FTNX when conducting business with suppliers at times, or end buyers for most of the time. A LDD replaces the need to issue a Performance  Guarantee(P.G) in the form of a SLC, even if such has already been secured from the supplier by FTNX. An end buyer doing business with FTNX  may accept the simpler less complicated more generous  virtues of a LDD against no P.G being provided all, which is simply expressed  on an offer of contract.The seller FTNX offers a LDD in dollar form rather than percentage form, per MT as added to delivery clause; meaning that If the seller FTNX is late with delivery by more than 24 hours, then the LDD value offered is deducted on the sellers invoices against the actual value of goods as an added discount. An LDD may be also paid as a rebate to the end buyer pro rata, without effecting the standing invoice values. A Pro rata value is a lesser value LDD but  in where such a payment comes due for every single day delivery  is late , until delivery is initiated up to a maximum period  of 7 Days. I.e: USD$1.00 per day LDD for top to 7 days 

 

PPIC

PROOF OF POLICY CERTIFICATE  Is a document of Intent; that is, the intent served in the form of a Certificate, as per the advice supported on its form.The PPIC is a creation of the FTNX. The PPIC has  to be  offered by the Seller and can be made a part of the DLC terms and collection conditions, in which case the PPIC is  the very first and earliest documents to be officially served.The only way a PPIC cannot be served is when the supplier actually  demands as part of its purchase agreement with FTNX that the nature of such disclosure are not allowed. The PPIC has a legal status and can actually be called in to stop a deal and even the irrevocable status of a credit, if what is declares on its body proves to be false. A PPIC is given to an end buyer if offered,  once  contracts are signed and the financial instrument is advised in where the end buyer  has 3 days to verify the PPIC by their own method directly with the supplier or via a trade section of a consulate. The PPIC provides exact information from where the goods offered by FTNX to its end buyer has come from in verifying that FTNX has secured such goods offered from a genuine ascertainable  supplier  and nothing more.The Purchase price of such goods or any other business aspect it has with the supplier  is not released. Whether the end buyer verifies the PPIC or not is irrelevant as the PPIC was given to appease the end buyers concern about supply.What is relevant however is that if the information regarding supply  proves to be false; the  bank issuing the DLC may instantly revoke it, once a statutory declaration is provided by the end buyer of the claims it is making.The seller can also be charged with criminal perjury. An buyer making a false declaration  can be charged for criminal perjury as well; accordingly the PPIC is a very important document, if served.The end buyer charged with perjury, can also be sued for loss of profit ,and the value of the whole  contract it tried to  deceptively avoid. A PPIVC therefore serves both parties to a contract. The use of such PPIC  delivers the sellers intent in regards supply in that its intention to supply goods offered is provable if it accepts a payment for goods offered , the has yet to be sourced. 

 

PROCEDURES 

When dealing with FTNX the trading following procedures apply whether we are dealing with a supplier or end buyer.The offer defines actual procedures the standard of which is described below. Procedures are very important  to matter of  delivery and schedule.

 

• OFFER 

• Once an offer is advised  it must be accepted within 5 Days 

• CONTRACT 

• A draft contract once advised but be returned with 10 Days of issuance.If the draft is accepted it’s a formal contract. One copy is advised by PDF and one hardcopy advised by courier postal mail. While waiting for the arrival of the hardcopy, the PDF contract allows  for the deal to continue. Postal receipt is provided to prove (intent) that the hardcopy contract was mailed.

• DLC ISSUANCE

• The DLC  is advised as defined on the contract; within 7 Days of contract signing date. The DLC must be accepted  by the seller FTNX  within 5 Banking Days

• FIRST DELIVERY

• Once official acceptance  of the  IDLC is communicated ( bank to bank) 1st deliver is initiated within 30 Days there after 

• DELIVERY

• Deliver is initiated cleanly per incoterms used. All the required documents are presented to the sellers bank. Collection proceeding applies within 5 Banking Days. Payment is collected.

• ARRIVAL

• Ship may or may have not slipped more by the time collection preceding take place; regardless, the goods are headed to the destination port of the end buyer. Notices are sent to the end buyer when the ship is ready to unload on approach to destination port.Tracking details are available.

• COLLECTING GOODS

• The end buyers hands over title document, pays all import duties and taxes  to customs and clear the goods for delivery to end buyers premise. If good are insured by the seller the buyer may have up to 270 days to reject part of the goods, ‘deemed not as ordered’ following a rejection process. If they insured by the supplier we allow 90 days or more as specified on contract for any rejection process to take place.

• REMEDY

• Justified legitimate claims are settles outright within 30 days of any successful claim for single shipments, or the value of claim successfully made is  deducted  from the value  of  goods as applied on the sellers invoice on the next revolving delivery.

 

TRANSACTION PERIOD

From the start of any transaction to  ‘delivery’ 60 days or more is often needed to complete a transaction before the ocean voyage  commences to final Port of destination delivery occurs. This aspect has also confused may end buyer and suppliers.  We do not deal in spot transactions but future transactions; that is FTNX is anticipating the goods it may need to source or secure for its clients 3 or 4 months  ahead of actually place an order.This  the reason why a validity date for the supply of goods of lets say 7 days is simply not acceptable. Delivery under the incoterms we use refers to ‘delivery’ of document not goods. We don’t make such rules; they  have been established for a long time. Bank use ‘Banking days’ , we do not  except when the ‘banking part’ of the transaction become apparent, as ‘banking days’ are used in matters of financial instrument  issuances, which is a UCP rule. week end are not ‘banking days’ as such 7 days tis what FTNX scouts for in their won procedures, when apply ‘days.’ We cannot track public holidays and special events as it occurs in every country of the word, hence FTNX uses ‘days’ for the majority of its schedule. Everything about FTNX procedures infer either standing international trading laws or rules; which is also something that many suppliers or end buyers are not aware about. When a supplier communicates to us that a ‘delivery’ can be made in i.e: 14 or 21 days we already know this is not true or possible, and that such a statement is made to quickly initiate a sale where parties are later argue about the actual delivery date at a time when they cannot ( the buyer) retract from a deal, without creating a loss. Above defines our standards transaction period and with it a first delivery date can be established,  in where all other parameter of the transaction can be met.

 

REBATES

When   a rebate is offer by FTNX, such may not appear on the contract so as not to effect its standard form, as changes often takes time to be effectively applied and could lead to a situation where we inadvertently created another legal issue on the contract. Accordingly rebates are stipulate on the offer.Transparent  rebates are paid by FTNX  into the account of the buyer as nominated at that time via SWIFT, within 7 Days  of any successful delivery. Many rebates exist including rates on confirmation fees, LDD and transfer fees.We are not interested nor can control  what the buyer does with the rebate, our business is to only ensure that such rebates are made transparent by FTNX from our perspective.We always assume to be conducting business with honourable people; should FTNX be made aware of, or suspect differently, the offer of a rebate will be applied on the contract or withdrawn and replaced as a discount applicable, against the goods as recorded on the sellers invoice.

 

BOL

When freight is offered, FTNX does not use Charter Party Bill of Lading (BOL) when presenting documents at collection time, because under UCP Rules we must present the more secure and more expensive   ‘Shipowners’ endorsed BOL, once again demonstrates why FTNX uses  an UCP endorsed  DLC so that matters of added security to the whole transaction is always apparent. We cannot  present a ‘transhipped’ BOL as well, due to matters of added security that we always seek to add to many transaction we apply.  We secure freight rate from  3 independent Carriers than apply to form one average price when offering freight to our clients, based on distance between Port of Loading (POL) and Port of Destination (POD). We also rebate any freight charges when we secure the ‘actual’ rate  once the vessel is booked .A FTNX freight rate will be more expensive than a Charter party rate, because we offer are security and will ensure any overage  on such freight offered  by us  is retuned to the buyer .This  why its often cheaper for an end buyer to secure a FOB  offer, as the end buyer books the vessel at the rate they are able to secure.Even if FTNX secure freight from the supplier, the ‘Ship-owners’ endorsed BOL will still produce a more expensive rate. FTNX does not allow, for matters once more related to added security,  for the BOL to be left open ( not endorsed in blank); and will only release an endorsed in blank BOL,as endorsed  by FTNX to the end buyer. If the end buyer need to  ship the goods to another end buyer (wholesaler / investment deal)  per his perspective, then he will need to book a carrier  and create a new BOL/deal from his side.

 

OTHER  DELIVERY MODES

DAP, EXW, DDP, DAT,  INCOTERMS  are delivery modes that FTNX will not offer except;In the matter of a very complex DAP (Delivery at Place) mode. DAP involves the delivery of goods past customs at port of  destination and directly to the suppliers premise or as otherwise agreed upon before the DLC may be collected upon. Such a transactions supporting a DAP delivery mode  is considered on merit by FTNX. These are very expensive deals as everything including import taxes and the likes including transport to supplier is instated by the seller before collection on a DLC is able to take place.Such deal takes month just to incept into an offer.  Two payment parts are involved when a DAP transaction if offered . One part is for the payment of actual goods and the other part is for a cash deposit as held and managed by our London based Lawyers, drawn against each invoice submitted for payment.A fee for producing the offer is also charged as the deal is a ‘disclosed one’ in that all parties are disclosed to each other in where FTNX bears responsibilities of it  own actions. FTNX as Agent is  acting on behalf of the disclosed end buyer. A DAP deal starts  with the end buyer providing an outline of what is needed in where a provisional  quote is submitted. No disclosures are apparent at this time. Once a quote is submitted and confirmed as accepted , FTNX produces the  formal  fully disclosed offer in where a fee is charged for service rendered up to this point before the disclosed offer is handed over for the end buyers final approval. If FTNX is retained to continue  the servicing the offer, an agreed upon payment or commission rate is agreed upon,  contracts are advises and FTNX initiates full delivery on behalf to the disclosed end buyer as per the actual purchase price of good and services secured. A DAP transaction one initiated  must start and be completed within 6 months in where the goods being ordered have been in part ( Revolving Transaction) of fully  delivered.