Drafting and Negotiating International Commercial Contracts, ICC 2010. • United Nations Convention for Contracts on International Sales of Goods (CISG), Vienna,1980. • UNIDROIT, Principles of International Commercial Contracts, Roma, 1994 and 2004. • Vu Huu Tuu, Foreign Trade Techniques, Hanoi, 2007. • Pham Duy Lien, International Trade Transactions, Hanoi, 2012
INTERNATIONAL TRADE TRANSACTIONS Faculty of Economics and International Business phanhien@ftu.edu.vn STUDY MATERIALS • Drafting and Negotiating International Commercial Contracts, ICC 2010 • United Nations Convention for Contracts on International Sales of Goods (CISG), Vienna,1980 • UNIDROIT, Principles of International Commercial Contracts, Roma, 1994 and 2004 • Vu Huu Tuu, Foreign Trade Techniques, Hanoi, 2007 • Pham Duy Lien, International Trade Transactions, Hanoi, 2012 Websites/Online sources -www.uncitral.org -www.cisg.law.pace.edu -www.unilex.info -http://www.iccwbo.org/ -www.trungtamwto.vn/vandedacbiet/cong-uoc-vien -www.moit.gov.vn -http://www.vcci.com.vn/ -Etc Course Description Study Objectives - Gaining theoretical knowledge and practice of international trade transactions - Skills in drafting and operating contracts for sales of goods - Well-doing business in different markets of commodities, trade partners, culture, etc Methodology - Two-way attending lectures on the class - Self-studying and exploiting materials suggested by the teacher - Analyzing case studies and team working Course Description Assessment Rate Form of Assessment Class participation 10% small tests Mid-term assessment 40% Time allowance Assignment Case study or presentation Mid-term exam Written exams 60 minutes Written exams 75 minutes Final-term exam 50% Study Schedule No Time Allocation In class Content Theory At home Exercise Self-study 10 20 10 Chapter 1: An overview on Trade & Modes of International Trade Transactions Chapter 2: Incoterms Chapter 3: Contracts for sales of goods Chapter 4: Export Management 10 Chapter 5: Import Management Total 30 15 10 60 Chapter MODES OF INTERNATIONAL TRADE TRANSACTIONS FUNDAMENTALS OF INTERNATIONAL TRADE Concepts International trade in goods and service: purchase, sale, exchange of goods and service across national borders Theory of international trade - Mercantilism - Absolute advantages and comparative advantages - Factors proportions - National Competitive Advantage FUNDAMENTALS OF INTERNATIONAL TRADE Main questions -What we trade?? -Who trades with whom? -How to trade?? -What are benefits and risks?? International trade in goods of Vietnam: Năm 2017 ghi nhận kỷ lục xuất nhập Việt Nam tổng mức lưu chuyển hàng hóa xuất, nhập vượt mốc 400 tỷ USD FUNDAMENTALS OF INTERNATIONAL TRADE • Kim ngạch hàng hóa xuất ước tính đạt 213,77 tỷ USD, tăng 21,1% Kim ngạch hàng hố nhập năm 2017 ước tính đạt 211,1 tỷ USD • Hoa Kỳ thị trường XK dẫn đầu với 41,5 tỷ USD, tăng 8% so với năm 2016 Tiếp đến EU đạt 38,3 tỷ USD, tăng 12,8%; Trung Quốc đạt 35,3 tỷ USD, tăng 60,6%; thị trường ASEAN đạt 21,7 tỷ USD, tăng 24,5%; Nhật Bản đạt 16,8 tỷ USD, tăng 14,2%; Hàn Quốc đạt 15 tỷ USD, tăng 31,1% • Trong khi, Trung Quốc thị trường nhập lớn nước ta năm 2017, với kim ngạch đạt 58,5 tỷ USD, tăng 16,9% so với năm 2016; tiếp đến Hàn Quốc đạt 46,8 tỷ USD, tăng 45,5%; ASEAN đạt 28 tỷ USD, tăng 16,4%; Nhật Bản đạt 16,5 tỷ USD, tăng 9,7%; EU đạt 12 tỷ USD, tăng 7,7%; Hoa Kỳ đạt 9,1 tỷ USD, tăng 4,9% • Proposed effectiveness index • Target Setting • Action Plan • Implementation II PREPARATION FOR IMPORT CONTRACT 1.Effective Amount of Order A: Annual ordered demand Q: Order Amount P: Order Cost S: Average Warehouse Cost C: Total cost of ordering and warehouse per year C = f(Q) = A.P/Q + S.Q/ f’(Q) = S/2 – A.P/Q2 Effective Q when : f’(Q) = Q = √2AP/Q Inquiry Price Exchange Quantity Unit Currency Time P1/P0 = I1/Io Delivery Conditions FOB = CIF - F - I = CIF - R * ( CIF + CIF *p) – F = CIF - R * CIF (1 + p) - F CIF = C + I + F = C + R * CIF ( 1+ p) + F → CIF - R * CIF ( 1+ p) = C + F C+F → CIF = - R * (1+p) Credit Terms and Period - Average Credit Period of time (T): ∑ xi ti T= xi ti ∑ xi : Paid Amount : Credit time - PCOD : At sight Price Per : Defferred Price r : Annual Bank Interest Rate Per = PCOD + PCOD T r = PCOD ( + T r) Price Checking and Computing International Trade Negotiation III IMPLEMETATION OF IMPORT TRANSACTIONS Acquiring for import permission Handling payment process (exp open L/C) Fill in the L/C Application Pay the Fee and the L/C deposit Booking for shipping space Pre- shipment notice III IMPLEMETATION OF IMPORT TRANSACTIONS Acquiring for cargo premium Payment of L/C value Check the payment document Custom clearance Taking delivery of import/ discharge the import III IMPLEMETATION OF IMPORT TRANSACTIONS 10 Inspection – Before discharging: Survey record at ship – During discharging: COR, ROROC – After discharging: cargo inspection, CSC, survey report 11 Claim and dispute resolution (if any) IV DOCUMENTS USED IN INTERNATIONAL TRADE TRANSACTIONS MAIN REQUIRED DOCUMENTS Commodities documents Transportation document Insurance documents Warehouse's document Finance Documents IV DOCUMENTS USED IN INTERNATIONAL TRADE TRANSACTIONS Commodities documents Commercial invoice Specification Packing list Quantity/ weight certificate Quality certificate Certificate of Origin IV DOCUMENTS USED IN INTERNATIONAL TRADE TRANSACTIONS Transportation document Bill of Lading Mate's receipt Seaway bill Shipping note Manifest Stowage plan IV DOCUMENTS USED IN INTERNATIONAL TRADE TRANSACTIONS Statement of facts Time- sheet Railway B/L Airway B/L Survey Records CSC (Certificate of Shortlanded Cargo) COR (Cargo Outturns Report) ROROC (Report On Receipt Of Cargo) IV DOCUMENTS USED IN INTERNATIONAL TRADE TRANSACTIONS Insurance documents Insurance Policy/ Insurance certificate / Survey report Warehouse's document Warehouse's receipt Warrant • Customs clearance dossier • Financial documents Q/A