Terms must be made according to united nations

Terms must be made according to United Nations Convention on Contracts for the International Sale
for Goods (UNCISG), aims to provide uniform rules for international trade.
Does not apply to all types of international sale, does not cover all aspects such as validity.
Section I of Chapter II covers rules relating to delivery
Article 35 in Section II of chapter II covers quantity and description, similar to SG SGA.
Section III of Chapter II covers remedies, has more remedies than SG SGA.
Chapter III covers buyer’s obligations to pay price and delivery of goods and seller’s remedies if
buyer defaults
Section II of Chapter V deals with damages, similar but not identical with SG
Section IV of Chapter V deals with defences
Transportation Terms: FOB – free on board, seller has to deliver goods on board a ship named by
buyer, buyer makes shipping arrangements, seller bear all costs up till goods on ship. Once on ship,
buyer responsible for all charges incurred after
CIF – cost, insurance, freight. Seller undertake transportation arrangements, seller engage a carrier,
arrange insurance and prepare invoice. Parties can use INCOTERMS published by International
Chamber of Commerce to resolve disputes
Payment terms: seller and buyer may not trust each other, thus a agent whom both can trust, ie
banks. Seller produces documents as required by contract, bill of lading showing goods have
shipped, gets payment from bank. Known as “letter of credit” transaction, governed by Uniform
Customs and Practice for Documentary Credits.
Risk component: Obligations of the shipper goverened by international convention, namely Hague
Visby rules and Warsaw Convention.
Article 35
(1) The seller must deliver goods which are of the quantity, quality and description required by the
contract and which are contained or packaged in the manner required by the contract. (Same as
Section 13)
(2) Except where the parties have agreed otherwise, the goods do not conform with the contract
unless they:
(a) are fit for the purposes for which goods of the same description would ordinarily be used ;
Section 14(2) and Section 14(3)
(b) are fit for any particular purpose expressly or impliedly made known to the seller at the time of
the conclusion of the contract, except where the circumstances show that the buyer did not rely, or
that it was unreasonable for him to rely, on the seller’s skill and judgement; Section 14(3)
(c) possess the qualities of goods which the seller has held out to the buyer as a sample ; Section 15
(d) are contained or packaged in the manner usual for such goods or, where there is no such
manner, in a manner adequate to preserve and protect the goods.
(3) The seller is not liable under subparagraphs (a) to (d) of the preceding paragraph for any lack of
conformity of the goods if, at the time of the conclusion of the contract, the buyer knew or could
not have been unaware of such lack of conformity.