General conditions for the supply of Plant and machinery for export

Prepared under the auspices of the

UNITED NATIONS ECONOMIC COMMISSION

FOR EUROPE

Geneva, March 1953

1. PREAMBLE

1.1 These General Conditions shall apply, save as varied by express agreement accepted in writing by both parties.

2. FORMATION OF CONTRACT

2.1. The Contract shall be deemed to have been en­
tered into when, upon receipt of an order, the Vendor has
sent an acceptance in writing within the time-limit (if any)
fixed by the Purchaser.

2.2. If the \fendor, in drawing up his tender, has fixed a
time-limit for acceptance, the Contract shall be deemed
to have been entered into when the Purchaser has sent an
acceptance in writing before the expiration of such time-
limit, provided that there shall be no binding Contract
unless the acceptance reaches the \fendor not later than
one week after the expiration of such time-limit.

DRAWINGS AND DESCRIPTIVE DOCUMENTS

3.1. The weights, dimensions, capacities, prices, per­formance ratings and other data included in catalogues, prospectuses, circulars, advertisements, illustrated mat­ter and price lists constitute an approximate guide. These

С. А. Семко, В. В. Сдобников, С. Н. Чекунова

data shall not be binding save to the extent that they are by reference expressly included in the Contract.

3.2. Any drawings or technical documents intended for
use in the construction of the Plant or of part thereof and
submitted to the Purchaser prior or subsequent to the for­
mation of the Contract remain the exclusive property of
the \fendor. They may not, without the Vendor's consent,
be utilised by the Purchaser or copied, reproduced, trans­
mitted or communicated to a third party. Provided, how­
ever, that the said plans and documents shall be the prop­
erty of the Purchaser:

a) if it is expressly so agreed, or

b) if they are referable to a separate preliminary Devel­
opment Contract on which no actual construction was to
be performed and in which the property of the Vendor in
the said plans and documents was not reserved.

 

3.3. Any drawings or technical documents intended for
use in the construction of the Plant or of part thereof and
submitted to the Vendor by the Purchaser prior or subse­
quent to the formation of the Contract remain the exclu­
sive property of the Purchaser. They may not, without his
consent, be utilised by the \fendor or copied, reproduced,
transmitted or communicated to a third party.

3.4. The Vendor shall, if required by the Purchaser,
furnish free of charge to the Purchaser at the commence­
ment of the Guarantee Period, as defined in Clause 9,
information and drawings other than manufacturing
drawings of the Plant in sufficient detail to enable the
Purchaser to carry out the erection, commissioning, op­
eration and maintenance (including running repairs) of
all parts of the Plant. Such information and drawings shall
be the property of the Purchaser and the restrictions on
their use set out in paragraph 2 hereof shall not apply
thereto. Provided that if the Vendor so stipulates, they
shall remain confidential.

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PACKING

4.1. Unless otherwise specified:

a) prices shown in price lists and catalogues shall be
deemed to apply to unpacked Plant;

b) prices quoted in tenders and in the Contract shall
include the cost of packing or protection required under
normal transport conditions to prevent damage to or de­
terioration of the Plant before it reaches its destination as
stated in the Contract.

5. INSPECTION AND TESTS
Inspection

5.1. If expressly agreed in the Contract, the Purchaser
shall be entitled to have the quality of the materials used
and the parts of the Plant, both during manufacture and
when completed, inspected and checked by his author­
ised representatives. Such inspection and checking shall
be carried out at the place of manufacture during normal
working hours after agreement with the \fendor as to date
and time.

5.2. If as a result of such inspection and checking the
Purchaser shall be of the opinion that any materials or parts
are defective or not in accordance with the Contract, he
shall state in writing his objections and the reason there­
fore.

Tests

5.3. Acceptance tests will be carried out and, unless
otherwise agreed, will be made at the Vendor's works and
during normal working hours. If the technical requirements
of the tests are not specified in the Contract, the tests will
be carried out in accordance with the general practice ob­
taining in the appropriate branch of the industry in the
country where the Plant is manufactured.

 

² Зак. 5274

С. А. Семко, В. В. Сдобников, С. Н. Чекунова

5.4. The Vendor shall give to the Purchaser sufficient
notice of the tests to permit the Purchaser's representa­
tives to attend. If the Purchaser is not represented at the
tests, the tests report shall be communicated by the Ven­
dor to the Purchaser and shall be accepted as accurate by
the Purchaser.

5.5. If on any test (other than a test on site, where
tests on site are provided for in the Contract) the Plant
shall be found to be defective or not in accordance with
the Contract, the Vendor shall with all speed make good
the defect or ensure that the Plant complies with the Con­
tract. Thereafter, if the Purchaser so requires, the test
shall be repeated.

5.6. Unless otherwise agreed, the Vendor shall bear
all the expenses of tests carried out in his works, except
the personal expenses of the Purchaser's representatives.

5.7. If the Contract provides for tests on site, the terms
and conditions governing such tests shall be such as may be
specially agreed between the parties.

PASSING OF RISKS

6.1. Save as provided in paragraph 7.6., the time at
which the risk shall pass be fixed in accordance with the
International Rules for the Interpretation of Trade
Terms (Incoterms) of the International Chamber of
Commerce in force at the date of the formation of the
Contract.

Where no indication is given in the Contract of the form of sale, the Plant shall be deemed to be sold «ex works».

6.2. In the case of a sale «ex works», the Vendor must
give notice in writing to the Purchaser of the date on which
the Purchaser must take delivery of the Plant. The notice
of the Vendor must be given in sufficient time to allow the
Purchaser to take such measures as are normally necessary
for the purpose of taking delivery.

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7. DELIVERY

7.1. Unless otherwise agreed, the delivery period shall
run from the latest of the following dates:

a) the date of the formation of the Contract as defined
in Clause 2;

b) the date on which the Vendor receives notice of the
issue of a valid import licence where such is necessary for
the execution of the Contract;

c) the date of the receipt by the Vendor of such pay­
ment in advance of manufacture as is stipulated in the
Contract.

 

7.2. Should delay in delivery be caused by any of the
circumstances mentioned in Clause 10 or by an act or
omission of the Purchaser and whether such cause occur
before or after the time or extended time for delivery, there
shall be granted subject to the provisions of paragraph
5 hereof such extension of the delivery period as is reason­
able having regard to all the circumstances of the case.

7.3. If a fixed time for delivery is provided for in the
Contract, and the Vendor fails to deliver within such time
or any extension thereof granted under paragraph 2 here­
of, the Purchaser shall be entitled, on giving to the Vendor
within a reasonable time notice in writing, to claim a re­
duction of the price payable under the Contract, unless it
can be reasonably concluded from the circumstances of
the particular case that the Purchaser has suffered no loss.
Such reduction shall equal the percentage named in para­
graph A of the Appendix of that part of the price payable
under the Contract which is properly attributable to such
portion of the Plant as cannot in consequence of the said
failure be put to the use intended for each complete week
of delay commencing on the due date of delivery, but shall
not exceed the maximum percentage named in paragraph
В of the Appendix. Such reduction shall be allowed when
a payment becomes due on or after delivery. Save as pro-

С. А. Семко, В. В. Сдобников, С. Н. Чекунова

vided in paragraph 5 hereof, such reduction of price shall be to the exclusion of any other remedy of the Purchaser in respect of the \fendor's failure to deliver as aforesaid.

7.4. If the time for delivery mentioned in the Contract
is an estimate only, either party may after the expiration of
two thirds of such estimated time require the other party
in writing to agree a fixed time.

Where no time for delivery is mentioned in the Con­tract, this course shall be open to either party after the expiration of six months from the formation of the Con­tract.

If in either case the parties fail to agree, either party may have recourse to arbitration, in accordance with the provisions of Clause 13, to determine a reasonable time for delivery and the time so determined shall be deemed to be fixed time for delivery provided for in the Contract and paragraph 3 hereof shall apply accordingly.

7.5. If any portion of the Plant in respect of which the
Purchaser has become entitled to the maximum reduc­
tion provided for by paragraph 3 hereof, or in respect of
which he would have been so entitled had he given the no­
tice referred to therein, remains undelivered, the Purchas­
er may by notice in writing to the Vendor require him to
deliver and by such last mentioned notice fix a final time
for delivery which shall be reasonable taking into account
such delay as has already occurred. If for any reason what­
ever the Vendor fails within such time to do everything that
he must do to effect delivery, the Purchaser shall be enti­
tled by notice in writing to the \endor, and without requir- j
ing the consent of any Court, to terminate the Contract in
respect of such portion of the Plant and thereupon to re­
cover from the Vendor any loss suffered by the Purchaser
by reason of the failure of the Vendor as aforesaid up to an
amount not exceeding the sum named in paragraph С of
the Appendix or, if no sum be named, that part of the price

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payable under the Contract which is properly attributable to such portion of the Plant as could not in consequence of the Vendor's failure be put to use intended.

7.6. If the Purchaser fails to accept delivery on due date,
he shall nevertheless make any payment conditional on
delivery as if the Plant has been delivered. The Vendor shall
arrange for the storage of the Plant at the risk and cost of
the Purchaser. If required by the Purchaser, the Vendor
shall insure the Plant at the cost of the Purchaser. Provided
that the delay in accepting delivery is due to one of the
circumstances mentioned in Clause 10 and the "Vendor is
in a position to store it in his premises without prejudice to
his business, the cost of storing the Plant shall not be borne
by the Purchaser.

7.7. Unless the failure of the Purchaser is due to any of
the circumstances mentioned in Clause 10, the Vendor may
require the Purchaser by notice in writing to accept deliv­
ery within a reasonable time.

- If the Purchaser fails for any reason whatever to do so within such time the Vendor shall be entitled by notice in writing to the Purchaser, and without requiring the con­sent of any Court, to determine the Contract in respect of such portion of the Plant as is by reason of the failure up to an amount not exceeding the sum named in paragraph D of the Appendix or, if no sum be named, that part of the price payable under the Contract which is properly attrib­utable to such portion of the Plant.

PAYMENT

8.1. Payment shall be made in the manner and at the
time or times agreed by the parties.

8.2. Any advance payments made by the Purchaser are
payments on account and do not constitute a deposit, the
abandonment of which would entitle either party to ter­
minate the Contract.

С. А. Семко, В. В. Сдобников, С. Н. Чекунова

8.3. If delivery has been made before payment of the
whole sum payable under the Contract, Plant delivered
shall, to the extent permitted by the law of the country
where the Plant is situated after delivery, remain the prop­
erty of the Vendor until such payment has been effected. If
such law does not permit the Vendor to retain the property
in the Plant, the Vendor shall be entitled to the benefit of
such other rights in respect thereof as such law permits him
to retain. The Purchaser shall give the Vendor every assist­
ance in taking any measures required to protect the Ven­
dor's rights of property or such other rights as aforesaid.

8.4. A payment conditional on the fulfilment of an ob­
ligation by the Vendor shall not be due until such obliga­
tion has been fulfilled, unless the failure of the Vendor is
due to an act or omission of the Purchaser.

8.5. If the Purchaser delays in making any payment,
the Vendor may postpone the fulfilment of his own obliga­
tions until such payment is made, unless the failure of the
Purchaser is due to an act or omission of the Vendor.

8.6. If delay by the Purchaser in making any payment is
due to one of the circumstances mentioned in Clause 10,
the "Vendor shall not be entitled to any interest on the sum
due.

8.7. Save as aforesaid, if the Purchaser delays in making
any payment, the Vendor shall on giving to the Purchaser
within a reasonable time notice in writing be entitled to the
payment of interest on the sum due at the rate fixed in par­
agraph E of the Appendix from the date on which such sum
became due. If at the end of the period fixed in paragraph F
of the Appendix, the Purchaser still have failed to pay the
sum due, the Vendor shall be entitled by notice in writing to
the Purchaser, and without requiring consent of any Court,
to terminate the Contract and thereupon to recover from
the Purchaser the amount of his loss up to the sum men­
tioned in paragraph D of the Appendix.

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GUARANTEE

9.1. Subject as hereinafter set out, the \fendor under­
takes to remedy any defect resulting from faulty design,
materials or workmanship.

9.2. This liability is limited to the defects which appear
during the period hereinafter called «the Guarantee Peri­
od») specified in paragraph G of the Appendix.

9.3. In fixing this period due account has been taken of
the time nonnally required for transport as contemplated
in the Contract.

9.4. In respect of such parts (whether of the "Vendor's
own manufacture or not) of the Plant as are expressly men­
tioned in the Contract, the Guarantee Period shall be such
other period (if any) as is specified in respect of each of
such parts.

9.5! The Guarantee Period shall start from the date on which the Purchaser receives notification in writing from the Vendor that the Plant is ready for dispatch. If dispatch is delayed, the Guarantee Period shall be extended by a period equivalent to the amount of the delay so as to per­mit the Purchaser the full benefit of the time given for trying out the Plant. Provided however that if such delay is due to a cause beyond the control of the Vendor such ex­tension shall not exceed the number of months stated in paragraph H of the Appendix.

9.6. The daily use of the Plant and the amount by which
the Guarantee Period shall be reduced if the Plant is used
more intensively are stated in paragraph I of the Appendix.

9.7. A fresh Guarantee Period equal to that stated in
paragraph G of the Appendix shall apply, under the same
terms and conditions as those applicable to the original
Plant, to parts supplied in replacement of defective parts
or to parts renewed in pursuance of this Clause. This provi­
sion shall not apply to the remaining parts of the Plant, the
Guarantee Period of which shall be extended only by a

С. А. Семко, В. В. Сдобников, С. Н. Чекунова

period equal to the period during which the Plant is out of action as a result of a defect covered by this Clause.

9.8. In order to be able to avail himself of his rights
under this Clause the Purchaser shall notify the Vendor in
writing without delay of any defects that have appeared
and shall give him every opportunity of inspecting and rem­
edying them.

9.9. On receipt of such notification the Vendor shall
remedy the defect forthwith and, save as mentioned in
paragraph 10 hereof, at his own expense. Save where the
nature of the defect is such that it is appropriate to effect
repairs on site, the Purchaser shall return to the Vendor
any part in which a defect covered by this Clause has ap­
peared, for repair or replacement by the Vendor, and in
such case the delivery to the Purchaser of such part prop­
erly repaired or a part in replacement thereof shall be
deemed to be a fulfilment by the Vendor of his obligations
under this paragraph in respect of such defective part.

9.10. Unless otherwise agreed, the Purchaser shall bear
the cost and risk of transport of defective parts and of re­
paired parts or parts supplied in replacement of such de­
fective parts between the place where the Plant is situated
and one of the following points:

1) the Vendor's works if the Contract is «ex works»
orF. O. R.;

2) the port from which the Vendor dispatched the Plant
if the Contract is К О. В., F. A. S., C. I. F. or C.& E;

3) in all other cases the frontier of the country from
which the Vendor dispatched the Plant.

 

9.11.Where, in pursuance of paragraph 9 hereof, repairs
are required to be effected on site, the conditions covering
the attendance of the Vendor's representatives on site shall
be such as may be specially agreed between the parties.

9.12.Defective parts replaced in accordance with this
Clause shall be placed at the disposal of the Vendor.

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9.13. If the Vendor refuses to fulfil his obligations un­
der this Clause or fails to proceed with due diligence after
being required so to do, the Purchaser may proceed to do
the necessary work at the \fendor's risk and expense, pro­
vided that he does so in the reasonable manner.

9.14. The \fendor's liability does not apply to defects
arising out of materials provided, or out of a design stipu­
lated, by the Purchaser.

9.15. The Vendor's liability shall apply only to defects
that appear under the conditions of operation provided
for by the Contract and under proper use. It does not cover
defects due to causes arising after the risk in the Plant has
passed in accordance with Clause 6. In particular it does
not cover defects arising from the Purchaser's faulty main­
tenance or erection, or from alterations carried out with­
out the "Vendor's consent in writing, or from repairs carried
out improperly by the Purchaser, nor does it cover normal
deterioration.

9.16. Save as in this Clause expressed, the Vendor
shall be under no liability in respect of defects after the
risk in the Plant has passed in accordance with Clause 6,
even if such defects are due to causes existing before the
risk so passed. It is expressly agreed that the Purchaser
shall have no claim in respect of personal injury or of
damage to property not the subject matter of the Con­
tract or of loss of profit unless it is shown from the cir­
cumstances of the case that the Vendor has been guilty
of gross misconduct.

9.17. «Gross misconduct» does not comprise any and
every lack of proper care or skill, but means an act or omis­
sion on the part of the Vendor implying either a failure to
pay due regard to serious consequences which a conscien­
tious Contractor would normally foresee as likely to en­
sure, or a deliberate disregard of any consequences of such
act or omission.

С. А. Семко, В. В. Сдобников, С. Н. Чекунова

10. RELIEFS

10.1. The following shall be considered as cases of re­
lief if they intervene after the formation of the Contract
and impede its performance: industrial disputes and any
other circumstances (e. g. fire, mobilization, requisition,
embargo, currency restrictions, insurrection, shortage of
transport, general shortage of materials and restrictions in
the use of power) when such other circumstances are be­
yond the control of the parties.

10.2. The party wishing to claim relief by reason of any
of the said circumstances shall notify the other party in
writing without delay on the intervention and on the cessa­
tion thereof.

10.3. The effects of the said circumstances, so far as they
affect the timely performance of their obligations by the
parties, are defined in Clauses 7 and 8. Save as provided in
paragraphs 7.5., 7.7. and 8.7., if, by reason of any of the said
circumstances, the performance of the Contract within a
reasonable time becomes impossible, either party shall be
entitled to terminate the Contract by notice in writing to
the other party without requiring the consent of any Court.

10.4. If the Contract is terminated in accordance with
paragraph 3 hereof, the division of the expenses incurred
in respect of the Contract shall be determined by agree­
ment between the parties.

10.5. In default of agreement it shall be determined by
the arbitrator which party has been prevented from per­
forming his obligations and that party shall bear the whole
of the said expenses. Where the Purchaser is required to
bear the whole of the expenses and has before the termi­
nation of the Contract paid to the Vendor more than the
amount of the Vendor's expenses, the Purchaser shall be
entitled to recover the excess.

If the arbitrator determines that both parties have been prevented from performing their obligations, he shall ap-

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portion the said expenses between the parties in such man­ner as to him seems fair and reasonable, having regard to all the circumstances of the case.

10.6. For the purposes of this Clause «expenses» means actual out-of-pocket expenses reasonably incurred, after both parties shall have mitigated their losses as far as possi­ble. Provided that as respects Plant delivered to the Pur­chaser the Vendor's expenses shall be deemed to be that part of the price payable under the Contract which is prop­erly attributable thereto.

LIMITATION OF DAMAGES

11.1. Where either party is liable in damages to the oth­
er, these shall not exceed the damage which the party in
default could reasonably have foreseen at the time of the
formation of the Contract.

11.2. The party who sets up the breach of the Contract
shall be under the duty to take all necessary measures to
mitigate the loss which has occurred provided that he can
do so without unreasonable inconvenience or cost. Should
he fail to do so, the party guilty of the breach may claim a
reduction in the damages.

RIGHTS AT TERMINATION

12.1. Termination of the Contract, from whatever cause arising, shall be without prejudice to the rights of the par­ties accrued under the Contract up to the time of termina­tion.