(Tiểu luận) group reportcourse law on business activitiessubject commercial processing auctions of goods

HO CHI MINH CITY OPEN UNIVERSITYLAW FACULTY ---⸹---GROUP REPORT COURSE: LAW ON BUSINESS ACTIVITIES SUBJECT: COMMERCIAL PROCESSING & AUCTIONS OF GOODS GROUP 5 CLASS: DH21BL02C ACADEMICS:

HO CHI MINH CITY OPEN UNIVERSITY

LAW FACULTY

-⸹ -GROUP REPORT COURSE: LAW ON BUSINESS ACTIVITIES SUBJECT: COMMERCIAL PROCESSING

& AUCTIONS OF GOODS

GROUP 5 CLASS: DH21BL02C ACADEMICS: LÊ THỊ TUYẾT HÀ

MEMBERS:

NGUYỄN NAM BẢO TRÂN NGUYỄN HOÀNG NGỌC ANHĐOÀN THỊ CẨM TÚ

NGUYỄN NGỌC PHƯƠNG UYÊNTRẦN THỊ Ý UYÊN

HUỲNH LÂM THẢO NGUYÊN

LÊ THỊ KHÁNH TRÚC

HO CHI MINH CITY – 2023

I PROCESSING 3

1 Concept– Features: 3

1.1 Subject of commercial processing: 3

1.2 Features of commercial processing: 3

2 Types of commercial processing: 3

3 Processing contracts: 4

3.1 Subjects of the processing contract 4

3.2 Legal characteristics of the processing contract 5

4 Rights and Obligations: 5

5 Processing remuneration: 7

6 Benefits of processing: 8

II AUCTIONS OF GOODS 8

1 Concept: 8

2 Method - Principle 9

2.1 Method: 9

2.2 Principle 10

3 Goods Auction Service Contract: 10

4 Rights and obligations of the parties: 10

5 Auction procedure 14

LIST OF REFERENCES 20

1.1 Subject of commercial processing:

- The processee is a person who has a need for molded products

- The party receiving the processing of raw materials or purchasing materials, organizing the processing in order to create products of the right design and method at the request of the processee.The processor must be a trader trading in trades suitable to the processed products

1.2 Features of commercial processing:

+ Property: Commercial processing is a commercial activity, so at least onesubject must have a profitable purpose

+ Legal relationship: Processing relations in commerce are expressed in thelegal form of processing contracts

+ Purpose: In commercial, entities (or at least one entity) in outsourcingrelations have the purpose of profit

+ Goods for processing: Goods of all types can be processed, except for goodsbanned from business In case of processing of goods for foreign traders foroverseas consumption, goods banned from business, goods banned from export

or import may be processed if so permitted by competent state agencies

(according to Article 180 of the Commercial Law 2005)

2 Types of commercial processing:

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- Based on market services:

+ Processing to serve the domestic market

+ Processing for export

- Based on the level of raw material supply:

+ Processing in which the processee assigns all raw materials to the processor.+ Processing in which the processee does not deliver any materials to theprocessor The processee must take care of the raw materials themselves toperform the processing and the processor will pay the raw materials togetherwith the processing remuneration

+ Processing in which the processee only delivers main materials according tonorms, as for the auxiliary materials, the processee can exploit it itself to ensurethe requirements

- Based on the stages in the production process:

+ Processing: production and processing, assembling, dismantling, demolishing,recycling, selecting, sorting, cleaning, refreshing, packing, marking codes,

dispensing…

3 Processing contracts:

- According to Article 179 of the Commercial Law 2005 “Processingcontracts must be made in writing or in other forms of equivalent legalvalidity.”

3.1 Subjects of the processing contract

- The subject matter of the arbitration agreement is a pre-determined materialaccording to the form, according to the standards agreed upon by the parties

or prescribed by law

- Object is a type of product or goods ordered by the outsourcing party underthe contract This specimen may be appointed by the outsourcer or given bythe processor and accepted by the outsourcer The template used by theparties must not be contrary to law and social ethics

- For example, the production of children's toys, when used for non-violentpropaganda purposes, or the appearance of the goods must conform to theaesthetic judgment of Vietnamese people, etc…

3.2 Legal characteristics of the processing contract

- Outsourcing contract is a bilateral contract

The processor has the right to require the ordering party to deliver tohim/her materials that meet the standards of quality, type, uniformity andquantity together with samples and drawings for manufacturing Theprocessor requires the contractor to accept the new property created byhimself and pay the remuneration as agreed

- Outsourcing contract is a contract of compensation

The amount that the processing hirer must pay to the processor is thecompensation This compensation is the remuneration agreed upon by theparties in the GC

- Outsourcing contract with materialized results

Objects are pre-determined according to a pattern, according to astandard agreed upon by the parties or prescribed by law in advance Thesample or standard of the workpiece is realized (materialized or become acommodity) only after the processing party has completed the processingwork

4 Rights and Obligations:

Processees ( Article 181 )

Processors ( Article 182 ) RIGHTS - To take back all processed

products, leased or lent machinery and equipment, raw materials, auxiliary materials, supplies and discarded materials after

- To receive processing remunerations and other reasonable expenses

- In case of processing for foreign organizations and individuals, to be entitled to

the liquidation of

processing contracts, unless

otherwise agreed

- To sell, destroy, donate or

give as gifts on the spot

processed products, leased

or lent machinery and

equipments, raw materials,

auxiliary materials,

redundant supplies, faulty

products and discarded

- In case of processing for foreign organizations and individuals, to be exempt from import tax on machinery, equipment, raw materials, auxiliary materials and supplies, that are temporarily imported for the performance of processing contracts according to the provisions

of tax law

OBLIGATIONS - To hand over part or

whole of raw materials and

materials for processing in

accordance with processing

contracts or transfer money

for purchase of materials

with agreed quantities,

quality and at agreed

- To supply a part or whole

of raw materials and materials for processing as agreed upon with processees in terms of quantities, quality, technicalstandards and prices

- To be responsible for the

- To send their representatives to examine and supervise processing activities at processing places, to assign experts to guide production technology and inspect quality of processed products according to agreements in processing contracts

- To be responsible for the legality of the intellectual property rights over processed goods, raw materials, materials, machinery and equipment for processing handed over

to processors

legality of goods processingactivities in cases where goods being processed are those banned from business,export or import

5 Processing remuneration:

According to Article 183 Commercial Law 2005:

+ Take advantage of available production facilities, machinery, equipment,factories, and raw materials, helping businesses take advantage of the

"brand" and distribution channels of goods of the outsourcing party insideand abroad, increasing the proportion of direct self-produced goods andexported goods

+ Reduce unemployment rate, increase people's income Becauseoutsourcing activities attracts a large part of cheap unskilled labor, it alsocontributes to reducing hiring costs and increasing profits for businesses.+ Attracting foreign capital and technology for goods processing

II AUCTIONS OF GOODS

1 Concept:

- According to Article 185 Commercial Law 20005, amending and

supplementing 2017, 2019, Auction of goods means a commercial activity whereby sellers themselves conduct or hire auction organizers to conduct public sale of goods to select purchasers that offer the highest prices

- Thus, the essence of auction activity is a buying and selling relationship in which buyers compete on price and eventually, the goods are sold at the highest price

a Features:

- This is a special sale In which the seller himself/herself or hires

an auction organizer (a trader providing auction services) toconduct the public sale of goods at a place and within a pre-

announced time for the buyer to pay price The right to buy thegoods will belong to the highest price.

- Objects of auction are goods that are allowed to circulate on themarket But usually, people only organize auctions of goods withspecific properties and use values These are goods that aredifficult to determine the true value, buyers can bid higher orlower than the starting price depending on the auction method onthe basis of fair competition

- The form of auction relationship exists in two forms: auctionservice contract and goods auction document

b Subject:

- According to Articles 186 and 187 of the Commercial Law 2005,Goods auction activities include the following subjects: auctionorganizers, sellers; auction participants and auctioneers

- Auction organizers are traders that register the business ofproviding auctioning services or sell their own goods in caseswhere goods sellers conduct auctions by themselves

- Goods sellers are owners of such goods or persons mandated bygoods owners to sell goods or persons entitled to sell goods ofothers according to the provisions of law

- Auction participants are organizations and individuals that register

- Upward bidding mode, which is an auctioning mode whereby theperson who offers the highest price as compared with the reserveprice shall have the right to purchase the auctioned goods;

- Downward bidding mode, which is an auctioning mode wherebythe person who first accepts the reserve price or the lower pricenext to the reserve price shall have the right to purchase theauctioned goods

2.2 Principle

The principles of publicity, honesty, and assurance of legitimate rights andinterests of auction participants

3 Goods Auction Service Contract:

- (According to Article 193 of the Commercial Law 2005)

- The goods auction organization service contract must be made inwriting or in another form with equivalent legal validity

- - In case the auctioned goods are the subject of pledge ormortgage, the auction organization service contract must beapproved by the pledgee or mortgagee and the seller must notifythe auction participants prices of goods being pledged ormortgaged

- - In case the pledge or mortgage contract has an agreement onauction, but the mortgagor or mortgagor is absent withoutplausible reasons or refuses to enter into a service contract toorganize the auction of goods, the auction organization servicecontract is entered into between the pledgee or mortgagee and theauction organizer

4 Rights and obligations of the parties:

Auction Organizers ( Article 189 - 190)

Goods Sellers that are not auction

organizers ( Article 191 – 192) RIGHTS - Unless otherwise agreed,

auction organizers shall have

the following rights:

- To request goods sellers to

provide fully, accurately and

promptly necessary

information on auctioned

goods, to create conditions

for auction organizers or

auction participants to

examine auctioned goods and

hand over auctioned goods to

goods purchasers in cases

where auction organizers are

not goods sellers;

- To determine reserve prices

in cases where auction

organizers are sellers of

auctioned goods or persons

authorized by goods sellers;

-To organize auctions;

- To request goods

purchasers to make

payments;

- To receive auction service

charges paid by goods sellers

according to the provisions

- Unless otherwise agreed, goods sellers shall have the following rights:

- To receive money amounts for auctioned goods and differences collected in cases specified in Clause 3, Article 204 of this Law

or receive goods back

in case of unsuccessfulauctions;

- To supervise the organization of auctions of goods

of Article 211 of this Law.

OBLIGATION

S

- To organize auctions of

goods in compliance with the

principles and procedures

provided for by law and by

auction modes agreed upon

with goods sellers

-To notify and post up in a

public, full and accurate

manner necessary

information on auctioned

goods

- To preserve auctioned

goods when they are

entrusted by sellers for

auctions of goods and send

them to goods sellers and

purchasers and relevant

parties according to the

- To deliver goods to auction organizers, create conditions for auction organizers and auction participants to examine goods, and supply in a full, accurate and timely manner necessary information on auctioned goods;-To pay auction organizing service charges according to Article 211 of this Law

contracts for provision of goods auctioning services.

-To carry out the procedures for transferring ownership rights over auctioned goods which are subject to the ownership registration as provided for by law, unless otherwise agreed with goods sellers

- To pay to goods sellers proceeds from the sale of goods, including differences collected from persons that withdraw their offered prices defined in Clause 3, Article

204 of this Law or return unsold goods to goods sellersaccording to agreements In case of no agreement, to pay money to goods seller within three working days after receiving money from goods purchasers, or to return the goods immediately within a reasonable time after auctions;

5 Auction procedure

Step 1: Establish a service contract for organizing a goods auction

♦ Goods auction activities by current laws may be carried out by sellers or auction organizations through service contracts for organizing goods auctions

♦ Form of contract: made in writing or other forms with equivalent legal validity such

as telegraph, fax, lexer, (Clause 1 of Article 193 LTM 2005)

Note:

– Where the goods to be auctioned are pledged or mortgaged, the auction organization service contract must be agreed by the pledgee or mortgagee and the seller must notify the auction parties about the goods being pledged or mortgaged

– In case there is an agreement on the auction sale in the pledge or mortgage contract but the pledgee or mortgagee is absent for no legitimate reason or refuses to enter into

a service contract for organizing goods auction, the auction organization service contract shall be entered into between the pledgee, mortgage with the auction organizer

Step 2: Prepare for the auction of goods

♦ Determine the starting price

This is the responsibility of the person conducting the auction of goods: the

responsibility of the Seller if it is he who conducts the auction of goods; Hold an auction if authorized by the seller

The notification is made before the listing of the auction

Note:

– Where auctioned goods are the object of pledge or mortgage, the pledged or mortgaged recipient must reach an agreement with the pledgee or mortgagee to determine the starting price

– In case there is an agreement in the contract of pledge or mortgage on the auction butthe pledgee or mortgagee is absent without a legitimate reason or refuses to enter into aservice contract for organizing the auction of goods, the starting price shall be determined by the pledged or mortgaged recipient

♦ Announcement and listing of goods auction

Deadline: At least seven working days before the auction of goods

Place of execution: at the place where the auction is held, the place where goods are displayed, and the headquarters of the auction organizer