OCIAL Procedures
Submitted by Larry Kortkamp on Wed, 03/24/2010 - 03:01
Typical Transaction Procedures
and Payment
Buyer sends (ICPO), plus the NCNDA/IMFPA. (Signed per Buyer).
Seller sends Draft Contract to buyer, plus the NCNDA/ IMPFA with Seller approval, while the Draft contract is revised if necessary.
Buyer and Seller (execute) sign and seal confirming by electronic signature the Final Contract and lodge thereafter with their respective banks. Subsequently, this contract is held and remains valid until hard copies are exchanged.
CONFIRMATION FORMAT” by MT-799” to Seller Trading Bank.
Such POF must be issued by a reputable bank acceptable to Seller’s nominated bank AND be for the full SPOT volume amount. Annual Contracts providing for monthly lifts and extending for 12 months or more require MT799 POF covering first two months of contracted volume. (The swift wire confirmation format of the RWA MT799 is included with contract).
Such POF must be issued by a reputable bank acceptable to Seller’s nominated bank AND be for the full SPOT volume amount. Annual Contracts providing for monthly lifts and extending for 12 months or more require MT799 POF covering first two months of contracted volume. (The swift wire confirmation format of the RWA MT799 is included with contract).
Upon receipt of the MT-799 the Seller’s Bank transmits by SWIFT Proof of Product (POP) documentation. The Swift will stipulate release of the Documents including: “Tank receipts, SGS reports on quality and quantity and Commercial invoice” to the buyer bank VIA Swift. Full Proof of Product shall be sent by the Seller’s Bank to the Buyers Bank within 24-48 banking hours of receipt of the MT-799.
Seller loads the product to the Buyers designated vessel as per INCOTERM
Buyer releases Payment (MT-103) for the amount equal to the first liftable quantity.
Bill of Lading will deem the contract executed.
The payment shall be made in US Dollars by MT-103 issued in favor of the Seller nominated bank. Such POF must be issued by a world top 50 ranked bank acceptable to Seller’s nominated bank, in the amount corresponding to the cost of the product amount. Buyer will release Payment (MT-103) for the amount of each liftable quantity until entire allotment has been lifted.
Then, the product will be registered, re-assigned, and cargo will be officially programmed in buyer’s name when the Buyer’s bank SWIFTS MT-103 for the value of liftable product to the seller’s bank.
The MT-103 shall be in the form accepted by the Seller’s bank and payment shall be made in accordance with the terms of this agreement (with copies transmitted by facsimile to the Buyer), following delivery and receipt thereof after arrival and inspection of the cargoes at the designated port of discharge.
Full payment for the cargo shall be made within ten (10) hours after the cargo has been inspected and discharged into shore tanks of delivery port and Quality and Quantity have been confirmed as correct by the Independent Surveyor Company.
Quantity and Quality, as assessed at the Discharge Port by the Independent Surveyor Company, and shall be used to compute the Seller's invoice.
Buyer shall instruct its bank to advise Seller’s bank by Swift, quoting the date of the transfer, the amount, the invoice number and the clearing bank, if any. Such advice is to be sent in due time in order to enable Seller’s bank to credit Seller with value on the due date.
