Shipping Policy: About CIF
Jun 26, 2023
CIF
- It means that when the goods pass the ship's rail at the port of shipment (actually in the ship's hold), the seller completes the delivery. The seller shall pay for the freight, insurance, etc. of the goods from the port of shipment to the port of destination, but the risk of damage and loss of the goods after loading shall be borne by the buyer.
- The main obligations of the seller
- Within the time limit stipulated in the contract, deliver the goods conforming to the contract to the ship destined for the designated port of destination at the port of shipment, and give the buyer a shipping notice.
- Responsible for handling the export procedures of goods, obtaining export licenses or other approval certificates (origin, commodity inspection certificate, etc.)
- Responsible for chartering or booking space and paying the sea freight to the port of destination.
- Responsible for handling cargo transportation insurance and paying insurance premiums.
- Responsible for all costs and risks until the goods cross the ship's rail at the port of shipment.
- Responsible for providing commercial invoices, insurance policies and bills of lading for goods shipped.
- Primary Obligations of the Buyer
- Pay the price according to the contract.
- Responsible for handling import procedures and obtaining import licenses or other approval documents.
- Bear all the costs and risks of the goods after they pass the ship's rail at the port of shipment,
- Receive the goods delivered by the seller in accordance with the contract and accept the documents in accordance with the contract.
- Precautions for CIF
1.Conceptual misunderstanding: CIF and FOB, the delivery point and the risk point in the terms are both on the ship at the port of shipment. The seller completes the seller's obligation by safely loading the goods on the ship at the port of shipment. Risks that may occur after shipment , the seller is no longer responsible for the phase, and the seller submits the insurance policy, bill of lading, etc.
By the buyer, the wind face claim and so on shall be handled by the buyer. After the seller loads the goods at the port of shipment, he obtains the ocean bill of lading and gives the main shipping documents to the bank or pays the buyer himself, underwrites the insurance, obtains the insurance policy and pays the sea freight and port miscellaneous charges, and then completes all delivery obligations.
2.Booking and stowage: Under CIF conditions, the seller books the ship independently, chooses the freight forwarder of the shipping company, pays the freight, terminal fee, etc., generally does not accept the freight forwarder/shipping company designated by the buyer, and the customer will choose foreign service better in actual business Well-known shipping companies such as Maersk and APL generally confirm with the buyer
Confirm the freight, and it is also acceptable after the shipping date, but it is generally not allowed to be shipped by the forwarder designated by the buyer. The seller gives the buyer full notice of shipment after shipment.
3.The seller handles the insurance at the port of shipment. Generally, when signing the contract, the insurance amount, insurance coverage and applicable insurance clauses, as well as the starting and ending period of the insurance liability are specified, and the insurance policy is selected by the association or the Chinese insurance clause. The insurance policy must be endorsed and transferred when the bank presents the documents to the buyer. The seller does not warrant that the goods will
The seller is not responsible for the damage, damp, loss, etc. of the goods after they are shipped.
4.Unloading fee: terminal operation fee, etc., one share in CIF uses the PORT TO PORT clause, the cost of the port of departure is borne by the seller, and the cost of the port of destination is borne by the buyer.
5. Shipment notification, cargo transit, arrival date, etc.
6.If the goods have been damaged or lost when the seller submits the documents, the buyer still needs to pay against the documents. The buyer can ask the shipping company/shipping agency and the insurance company for damage compensation based on the bill of lading and the insurance policy, but cannot file a claim against the seller.
7. In the actual business, it is unreasonable for the buyer to claim that the goods are in the transit port, the goods are not transferred on time, the container is dropped, and the goods are delayed for two or three times on the way and the arrival date affects the delivery of the garments/finished products. , how to avoid stating that the seller has no post-shipment
The obligation to guarantee when the goods will arrive at the port of destination and the date of transit cannot be guaranteed.
