Deletion?

PGauntlett · Post by **PGauntlett** » Fri Feb 28, 2003 12:00 am

This is a real situation:

A credit states 'All docs except invoice must not show unit price, invoice no., price terms.....'

Although covered with correction fluid and authenticated as a correction, B/L states 'CIF Kaohsiung' i.e. this is clearly legible under the correction fluid.

Since the prohibiting of docs showing this information is for confidentiality purposes can a deletion in the manner stated above still mean the document meets the l/c requirement?

Phil Gauntlett

[edited 2/28/03 2:52:20 PM]

NigelHolt · Post by **NigelHolt** » Fri Feb 28, 2003 12:00 am

Phil,

Hope you’re well; must get together for a beer soon.

This is such a nasty one that, were it not you, I’d probably not attempt a response. My personal views, with considerable hesitation and without responsibility/liability, are that if the ‘price terms’ are still cleary legible under the correction fluid then the b/l does ‘show’ them and is thus discrepant.

Whatever decision I took, I’d be cringing if I had to go to court on this one. Hope it’s not a lot of money (but given your operations no doubt it is).

Regards, Jeremy

LeoCullen · Post by **LeoCullen** » Fri Feb 28, 2003 12:00 am

Wow!

If I had to make a decision on this,
I would say it is a discrepancy because you can easily see the "prohibited" information.

The way that you describe it there may as well be an arrow by the term with the text "Please ignore these words,
they do not exist".

lroland · Post by **lroland** » Fri Feb 28, 2003 12:00 am

If I can understand the reason why unit price or price should not appear on some documents I am asking myself in this precise case, is there any commercial sense in this transaction ?

Roland

PGauntlett · Post by **PGauntlett** » Fri Feb 28, 2003 12:00 am

Roland,

It's simply a case of a back-to-back situation whereby a middle man does not want his buyer to know what the original selling price/terms are

Phil

larryBacon · Post by **larryBacon** » Tue Mar 04, 2003 12:00 am

Since a "price term" is not an incoterm, CIF Kaohsiung as an incoterm should be permitted. I presume that the port of destination is shown elsewhere on the B/L as Kaohsiung, so the additional information indicates that the supplier pays for freight & insurance. It does not give sensitive cost or price information in so doing & is therefore not discrepant.

Laurence

NigelHolt · Post by **NigelHolt** » Wed Mar 05, 2003 12:00 am

Laurence

I beg to differ.

Bankers use the expressions ‘price terms’, ‘trade terms’, ‘price basis’ etc to include Incoterms. I say ‘include’ because one can have a price basis not recognised by Incoterms, as Incoterms 2000 itself recognises (section 11 of the intro). I would also observe the intro, first para, to Incoterms 2000 describes the Incoterms as being ‘trade terms’. Therefore, there is no doubt in my mind, and I imagine other bankers, that CIF Kaohsiung is a ‘price term’.

Jeremy

larryBacon · Post by **larryBacon** » Sat Mar 08, 2003 12:00 am

Jeremy,

whilst I agree that Incoterms are "trade terms", there is no link to suggest that any of these are price terms. If one looks at par 2 of the same introduction, one can see that these relate to international trading practices. The following para stresses that Incoterms "is limited to matters relating to the rights and obligations of the parties to the contract of sale...."

Laurence

NigelHolt · Post by **NigelHolt** » Sat Mar 08, 2003 12:00 am

Laurence,

I agree that the expression ‘price term’ is not used in Incoterms 2000. Nonetheless, bankers use the expressions ‘price term’, ‘shipping term’ and ‘price basis’ to mean what Incoterms 2000 calls a ‘trade term’. If you look at Opinion R236 from the 95-96 Queries, ‘Description of goods in the invoice vs. description in the credit’, you will find an example of the expression ‘price term’ being used to mean ‘trade term’ (in fact both expressions are used interchangeably).

Jeremy

larryBacon · Post by **larryBacon** » Sun Mar 09, 2003 12:00 am

Jeremy,

if you look further into R236, you will see that this query relates to a DC quoting a "price term", but R236 indicates that this should have read "trade term" as FOB Japan was quoted (last para before Analysis/Conclusion).

Laurence