Situation 6 International Trade,Task 8 Inspection, Claim, Force Majeure and Arbitration,Task 8 Inspection, Claim, Force Majeure and Arbitration, Objectives 1. Grasp the concept of inspection, claim, force majeure and arbitration; 2. Understand the basic procedures of commodity inspection and related claims.,Task 8 Inspection, Claim, Force Majeure and Arbitration,I Pre-reading Pair work: Discuss the following questions with your partner. 1. Who do you think should conduct the inspection? 2. Why should the buyer claim in your opinion? 3. When disputes arise in international trade, how to solve it in your opinion? 4. What do you think is arbitration? 5. What kind of events can be called force majeure in your opinion?,Task 8 Inspection, Claim, Force Majeure and Arbitration,II Case study of the task Dispute About Compensation Company A in Shanghai was to import 20 sets of precision apparatus from Company B in Hong Kong at the price of HK$30,000 per set. It was stipulated in the contract that any party who breaks the contract has to pay the other HK$10,000 as penalty. It turned out that the seller only delivered 12 sets, failing to deliver the rest 8 for the unit price had increased to HK$40,000. The seller wanted to pay the penalty of HK$10,000 as provided in the contract, to which the buyer did not agree.,Task 8 Inspection, Claim, Force Majeure and Arbitration,Questions: 1. Why did the seller want to pay penalty to the buyer? 2. Is HK$10,000 enough for the penalty in your opinion? 3. In this case, what amount do you think the buyer can claim against the seller? Why?,Task 8 Inspection, Claim, Force Majeure and Arbitration,III Text Inspection, Claim, Force Majeure and Arbitration Commodity Inspection Claims Force Majeure Arbitration,Task 8 Inspection, Claim, Force Majeure and Arbitration,New Words and Expressions: authorized adj 权威认可的 indispensable adj. 不可缺少的；绝对必要的 authentic adj 真实的：值得相信、信赖的 nominate v. 任命 bureau n. 局司处等行政单位：政府部门或其下属机构 designate v. 指定；指出 discrepancy n. 矛盾，不相符 refund n. 退款; 偿还金额 penalty n. 罚金 attest v. 证明，证实 litigation n. 诉讼, 起诉 mediation n. 调停，仲裁 revision n. 修订 amicable adj. 友善的,Task 8 Inspection, Claim, Force Majeure and Arbitration,V Consolidating and Expanding Summarizing knowledge 1. Definition of Commodity Inspection and Force Majeure Commodity inspection is the inspection conducted by a third, authorized party to testify whether the quality, quantity, package, etc. would be the same as those terms specified in the contract. Force majeure is an event that can be neither anticipated nor reduced to control, e.g., an industrial strike that leads to loss of profits.,Task 8 Inspection, Claim, Force Majeure and Arbitration,2. The general arbitration procedures: 1) Submit dispute to arbitration 2) Appoint arbitrators 3) Hear a case 4) Issue an award 5) Fees,Task 8 Inspection, Claim, Force Majeure and Arbitration, Practical training 1. Compose two letters with the following particulars. 1) A complaint letter for later delivery. a. Referring to the previous letters, cables or documents about the date of shipment; b. Stating that the goods have not been received, and didnt catch the selling season; c. Stating that the delay makes you suffer some loss and lodging a claim for the loss of.,Task 8 Inspection, Claim, Force Majeure and Arbitration,2) A reply to the above letter. a. Informing the customer of receiving the letter or cable and express regret for delaying the goods; b. Stating the reason of late delivery; c. Promising to make compensation for the customers loss.,Task 8 Inspection, Claim, Force Majeure and Arbitration,3) An American buyer has ordered 600 cases of green ea from Hangzhou Tea Company. Upon arrival at Baltimore Port, shortage was found in the shipment. The American buyer lodges a claim about this. How are you going to settle the claim in a satisfactory way if you are the boss of the company?,Task 8 Inspection, Claim, Force Majeure and Arbitration,2. Analyze the following and discuss Damage Caused by Serious Quality Defect An export company in China concluded a deal on edible on edible citric acid. While delivering the goods, they mistook inedible citric acid for the edible kind. Not until several days after the vessels departure did they discover the mistake. By then, the relevant documents had,Task 8 Inspection, Claim, Force Majeure and Arbitration,already been sent by the negotiating bank. To avoid severe consequences, the export company tried to withhold the documents at the post office, while, on the other hand, it urgently informed the ocean shipping agency to ask the agent in Hong Kong to hold back the goods when the ship called at the port. Though an accident has been avoided, the export company has suffered a great loss.,Task 8 Inspection, Claim, Force Majeure and Arbitration,Questions : 1) Has the export company severely violated the stipulations of relevant international conventions? Why? 2) Whats a very serious fault for t