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What Contract means

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contractObject of the contract identified in a technical/quality document
Term of the contract: Calendar date – Completion work
Assignment: Contract – Credit arising out of the contract
Termination: Infringements of the contractual terms – liquidation – reconstruction – bankruptcy

Terms of delivery:
• Incoterms
• Transfer of responsibility
• Title and risk of loss
• Taxes and duties
Authorization/license: Several types
Prices: Firm and fixed – Escalation clause
Insurance: Product liability – Personnel – Credit
Confidentiality: Attachment “not disclosure agreement”.

Contract Check List:

◊ GENERAL STATEMENT
◊ DEFINITIONS
◊ CONTRACT CHECK LIST
◊ PREVALENCE OF THE APPLICABLE DOCUMENTS
◊ CONTRACTING PARTIES AND SIGNATURE POWER
◊ OBJECT/SCOPE OF THE CONTRACT
◊ TERM OF THE CONTRACT
◊ ASSIGNMENT
◊ PENALTIES
◊ RECESSION/WITHDRAWAL
◊ TERMINATION
◊ FORCE MAJEURE
◊ TERMS OF DELIVERY
◊ AUTHORIZATION/LICENCE
◊ PRICES
◊ PAYMENT
◊ CHANGE RISK
◊ INSURANCE
◊ CONFIDENTIALITY
◊ APPLICABLE/GOVERNING LAW
◊ JURISDICTION AND ARBITRATION
◊ ANNEX/ATTACHMENTS

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Trade Flow and Purchasing

a) Purchase request received from an “Internal Customer” (For example: Commercial Dept, Technical Dept)
b) Purchase request analysis
c) Search and specification of the supplying sources (advisable at least three)
d) Supply / Tender request sent to the supplier
e) Receipt of the supplier’s supply / tender analysis and evaluation
f) Choice of the supplier
g) Sending of the purchase order with annexed “general conditions of purchase”
h) In particular the purchase order should provide as follows :
Quality condition / Requisite
Quantity condition / Requisite
Price condition / Requisite
Delivery Terms / Requisite
Conditions of Payment
i) Receipt of the order copy confirmation duly signed by supplier
j) Eventual purchase order variant
k) Start of the supplying

Business dept involved by a incorrect trade flow and purchasing
Procurement Dept
Technical Dept
Logistic Dept
Quality Assurance Dept
Quality Control Dept
Manufacture Dept
Book – Keeping Dept
General Affair/Legal Dept
Commercial Dept
Product support

Authorization
Currency Trade – Union – Customs

Licence
Manufacture , Export , Distribution of products/allotment – of duties , Environment, Know – How

Legal Elements
– Legal report request
– Chamber of commerce certificate
NO:
– Reconstruction
– Liquidation whether voluntary or otherwise
– Chapter 11
– Chapter 13
– Compound with hiscreditors
– Bankruptcy

Economic Elements
– Commercial / Financial report request
– Copy of the supplier’s balance request
– Analysis of balance sheet index
ROE Return Of Equity
ROI Return Of Investment
ROS Return Of Sale
G.I. Degree Of Running Into Debt
– Balance of payment analysis
– Amortization analysis
– For example: warehouse
– Machinery