Part II Electronic Documents: Legal Framework, 3 International Sale Contracts and Their Performance

Subject(s):

Carriage of goods — Contract — CIF contracts and damages — FOB contracts and damages — Contracts and insurance — Payment obligations of the buyer — Taking delivery and obligations of the buyer — Delivery and obligations of the seller

This chapter examines international sale contracts and their performance. In a contract for the sale of goods, the seller and the buyer both take on obligations: the seller, to deliver the goods in accordance with the contract terms; and the buyer, to accept compliant goods and to pay for them. The international sale of goods is characterized by the ubiquitous use of standard contractual terms, prepared by representative bodies including the International Chamber of Commerce (ICC), whose international commercial terms are used for all types of international sale, as well as trade associations. Two types of standard contract that are in widespread use in maritime trade and which have been commented on extensively by the courts are contracts on cost, insurance, and freight (CIF) terms and contracts on free on board (FOB) terms. The chapter then considers the performance of the payment obligation and supply chain finance.