GENERAL  CONDITIONS FOR THE SUPPLY OF PLANT AND MACHINERY FOR EXPORT
Prepared under the auspices of the
UNITED NATIONS  ECONOMIC COMMISSION FOR EUROPE
GENEVA, MARCH, 1953

1.	Preamble
1.1	These General Conditions shall apply, save as varies by  express agreement  accepted in writing by both parties.

2.	Formation of Contract
2.1	The Contract shall be deemed to have been entered  into when, upon receipt of an order, the vendor has sent  an acceptance in writing within the time limit (if any) fixed  by the purchaser.

2.2	If the Vendor, in drawing up his tender, has fixed  a time-limit for acceptance, the Contract shall be deemed to have been entered into when  the Purchaser has sent an acceptance in writing before the expiration  of such time-limit, provided that there shall be not binding Contract unless the acceptance reaches  the Vendor not later than one week after the expiration of such time-limit.

3.	Drawing  and descriptive document

3.1	The  weights, dimensions, capacities, prices, performance ratings and other data included  in catalogues, prospectuses, circulars, advertisements,  illustrated matter  and price lists constitute  an  approximate  guide. These  data shall not be binding save to the extent that they are by reference expressly included  in the Contract.

3.2	Any drawings or technical documents intended, for use in the construction of the Plant or of part  thereof and submitted to the Purchaser  prior or subsequent  to the  formation of  the Contract remain the exclusive  property of the Vendor. They may not,  without  the Vendor’s  consent, be utilised by the  Purchaser  or copied, reproduced, transmitted  or communicated  to  a third party. Provided, however, that the said plants and documents shall be the property of the Purchaser;

(a)	if it  is expressly so agreed, or
(b)	if  they are  referable  to  a separate  preliminary Development  Contract  on which  no  actual construction  was to be  performed and in  which  the property  of the Vendor  in the said plans and documents was not reserved.

3.3	Any drawings or technical  documents intended for use in the construction of the Plant or of part  thereof  and submitted  to the Vendor by the Purchaser prior or subsequently  to the formation of the Contract remain the exclusive property of the Purchaser. They may not, without  his consent, be utilised by the Vendor, or copied, reproduced, transmitted or communicated  to a third  party.

3.4	The vendor shall, if required  by the Purchaser, furnish free of charge  to the Purchaser at the commencement of the Guarantee period, as defined in Clause 9, information and drawings other  than manufacturing  drawings of the Plant of sufficient detail to enable  the Purchaser to carry out the erection, commissioning,  operation and maintenance (including running repairs) of all parts of the Plant. Such information and drawing shall be the property of the Purchaser and the restrictions on their use set out in paragraph 2  hereof shall not apply thereto. Provided that if the vendor so stipulates, they shall remain confidential.

4.	Packi8ng

4.1	Unless otherwise  specified :

(a)	prices shown in price lists and catalogues shall be deemed to apply to unpacked Plant ;

(b)	prices quoted  in tenders and in the Contract shall include the cost  of packing or protection required  under normal transport conditions to prevent damage to or deterioration of the Plant before it reaches its destination as stated in the Contract.

5.	Inspection and Tests
5.1	If expressly agreed in the Contract, the Purchaser shall entitled to have the quality of the materials used and the parts of the Plant, both  during manufacture  and when completed, inspected  and checked by his  authorised representatives. Such  inspection and checking shall be carried  out at the place of manufacture during  normal working hours after agreement with the Vendor as to date and time.

5.2	If as  a result of such inspection and checking the Purchaser  shall be of the opinion that any materials or  parts  are defective  or not in accordance  with the Contract, he shall state  in writing  his objections and the reason thereof.

TESTS

5.3	Acceptance tests will be carried out and, unless otherwise agreed, will be made  at the vendor’s works and during normal working hours.  If  the technical  requirements of the tests are not specified in the Contract, the tests will be  carried out in accordance with the general  practice obtaining  in the appropriate branch  of the industry in the country where the Plant is manufactured.

5.4	The Vendor shall give to the Purchaser sufficient notice  of the tests  to permit the Purchaser’s representatives to attend. If the Purchaser is not represented at the tests, the test report  shall be communicated  by the Vendor to the Purchaser and shall be accepted as accurate by the Purchaser .

5.5	If on any test (other than a test on site, where test on site are provided for in the Contract) the Plant shall be found to be defective or not in accordance with the Contract,  the Vendor shall with all speed  make good  the defect or ensure that the Plant complies  with the Contract. Thereafter, if the Purchaser so requires, the test shall be repeated.

5.6	Unless  otherwise agreed, the Vendor shall bear all the expenses of tests carried  out in his works, except the personal expenses of the Purchaser’s representatives.

5.7	If the contract provides  for test on site, the terms and conditions governing such tests shall be such as may be specially agreed between the parties.

6.	Passing or risk
6.1	Save as provided  in paragraph 7.6 the time at which the risk shall pass  be fixed in accordance with the International Rules for the  Interpretation of Trade Term(Incoterms) of the  International Chamber of Commerce in force at the date of the formation of the Contract. Where no indication is given in the Contract of the form of sale, the Plant shall be deemed to be sold “ex-works”.

6.2	In  the case of a  sale “ex-works’, the Vendor must give  notice in writing  to the Purchaser of the date on which the Purchaser must take  delivery of the Plant. The notice of the Vendor must be given in sufficient time to allow the Purchaser to take such measures as are normally necessary for purpose of taking delivery.

7. 	Delivery
7.1	Unless otherwise agreed, the delivery period shall run from the latest  of the following dates :

(a)	the date of the formation of the Contract as defined in Clauses 2;

(b)	the date on which the vendor receives notice of the issue of a valid import  licence where such is necessary for the execution  of the Contract ;

(c)	the date of the receipt by the Vendor of such payment in advance of manufacture as  is stipulated in the Contract.

7.2	Should delay in delivery be caused  by any of the circumstances  mentioned  in Clauses 10 or by  an act or omission of the Purchaser  and whether such cause  occurs before or after the time or extended  time for delivery, there shall  be granted  subject to the provisions of paragraph 5 hereof  such extension of the delivery period as is reasonable   having regard to all circumstances of the case.

7.3	If a fixed time for  delivery is provided for in the Contract, and the Vendor fails to deliver within such time or any extension thereof  granted under paragraph 2 hereof, the Purchaser shall be entitled,  on giving  to the Vendor within a reasonable time notice in writing  to claim a reduction of the price  payable under the Contract, unless it can be reasonably  concluded from the  circumstances of the particular case that the Purchaser has  suffered no loss. Such reduction shall equal the percentage named  in paragraph A  of the  Appendix of that part of the price payable under the Contract  which is properly  attributable  to such portion of the Plant as cannot in consequence of the said failure  be put to the use  intended  for each complete week  of delay commencing on the due  date  of delivery, but shall  not exceed  the maximum percentage named in paragraph B of the Appendix. Such reduction shall be allowed  when a payment  becomes  due on  or after  delivery. Save as provided in paragraph 5 hereof, such reduction  of price shall be to the exclusion  of any other remedy of the Purchaser in respect  of the Vendor’s failure to deliver as aforesaid.

7.4	If the time for delivery mentioned in the Contract is an estimate only, either  party may after  the expiration of two  thirds of such estimated time require the other party in writing to agree a fixed time.

Where  no time for delivery is mentioned in the Contract, this course  shall be open  to either party after the expiration  of six months from the formation of the Contract.

If  in either  case the parties  fail to agree, either party may have recourse to arbitration, in accordance with the provisions of Clause 13, to determine a reasonable time for delivery and the time so determined  shall be deemed  to be  the fixed time for delivery provided for in the Contract and paragraph 3  hereof shall apply accordingly.

7.5	If  any portion of the Plant is respect of which the Purchaser has become entitled to the maximum reduction provided for by paragraph 3 hereof, or in respect  of which he would have been so entitled had he given the notice referred to therein, remains undelivered, the Purchaser many by notice in writing to the Vendor require  him to deliver and by such last mentioned  notice fix  a final time  for delivery which   shall be  reasonable, taking into account such delay as has  already occurred. If for any reason  whatever  the Vendor fails within  such time  to do everything that he must do to effect delivery the Purchaser shall be entitled  by notice in  writing to the Vendor and without requiring the consent of any Court, to  terminate  the Contract  in respect of such portion of the Plant and thereupon to recover from the Vendor any loss suffered  by the Purchaser by  reason  of the failure  of the Vendor as aforesaid  up to  an amount not exceeding  the sum named in paragraph C of the  Appendix or, if no sum be named, that part of the price payable under the Contract which is properly attributable  to such portion of the Plant as could not in  consequence  of the Vendor’s failure be put to the use intended.

7.6	If the Purchaser fails to accept delivery on due date, he shall nevertheless make any payment conditional on delivery as if the  Plant had been delivered. The Vendor shall arrange for the storage of the Plant at the risk  and cost of the Purchaser. Provided  that is the delay in accepting delivery is due to one of the circumstances mentioned in Clauses 10 and the Vendor is in a position to store it in his premises  without prejudice to his business, the cost of storing the Plant shall not be  borne by the  Purchaser.

7.7	Unless  the failure of the Purchaser is due to any of the  circumstances mentioned in Clause 10, the Vendor may require Purchaser by notice in Writing to accept delivery within a  reasonable time.

If the Purchaser fails for  any reason whatsoever to do so within time the Vendor shall be entitled by notice in writing to the  Purchaser  and without requiring the consent  of any Court, to terminate the Contract in respect of such portion of the  Plant as is by reason of such failure up to an  amount  not exceeding the sum named in paragraph D of the Appendix  or, if no sum  be named,  that part of the price payable under the Contract which is properly attributable  to such portion of the Plant.

8.	Payment
8.1	Payment shall be made in the manner and at the time or times agreed by the parties.

8.2	Any advance payments made by the  Purchaser are payments on account and do  not constitute a deposit,  the abandonment of which  would entitle  either party to terminate the Contract.

8.3	If delivery has been made before payment of the whole  sum payable under the Contract, Plant delivered shall to the extent permitted  by the law of the country where the Plant is situated after delivery remain the property of the  Vendor until such  payment has been effected. If such  law does not permit the Vendor  to retain  the property in the Plant, the Vendor shall be entitled  to  the benefit  of such  other rights  in respect thereof  as such law permits him to retain. The  Purchaser  shall give  the Vendor every assistance in taking any measures  required  to protect  the Vendor’s right of property or such other rights  as aforesaid.

8.4	A payment conditional on the fulfilment of an obligation  by the Vendor shall  not be  due until such obligation has been  fulfilled  unless the failure of the Vendor is  due  to an act or omission of the Purchaser.

8.5	If the Purchaser delays  in making any payment the Vendor may postpone  the fulfillment of his own  obligations until such payment is made unless the failure of the Purchaser is due to an act or  omission of the Vendor.

8.6	If delay  by the Purchaser in making any payment is due to one  of the circumstances mentioned in Clause 10, the Vendor shall not be entitled to any interest on the sum due.

8.7	Save as aforesaid,  if the Purchaser  delays in making any payment, the Vendor shall on giving  to the Purchaser within a reasonable time  notice in writing   be entitled  to the payment  on interest on  the  sum due at the rate fixed  in paragraph  E of the Appendix from the  date on which such sum become  due. If at the end  of the period fixed in paragraph F of the Appendix, the Purchaser shall still  have failed  to pay the sum due, the Vendor shall be entitled  by notice in writing to the Purchaser, and without requiring the consent to any Court, to terminate the Contract and thereupon to  recover from the Purchaser the amount of his loss up to the sum mentioned in paragraph D of the Appendix.

9.	Guarantee
9.1	Subject as hereinafter set out, the Vendor undertakes to remedy any defect resulting from faulty design,  materials or workmanship.

9.2	This liability is limited to defects which appear during the period  (hereinafter called  “the  Guarantee Period”)  specified in paragraph C of Appendix.

9.3	In fixing this period due account has been  taken of the time normally  required for transport  as contemplated in the Contract.

9.4	In respect  of  such parts (whether of the Vendor’s  own manufacture  or not) of the Plant as are expressly mentioned  in the Contract, the  Guarantee  Period  shall be such other  period (if any) as is specified in respect of each of such parts.

9.5	The Guarantee Period shall start from the date on which the Purchaser receives notification in writing from the Vendor that the Plant  is ready for  dispatch  from the works. If  dispatch is  delayed, the Guarantee Period  shall be extended by a period equivalent to the amount of the delay  so as to permit the  Purchaser  the full  benefit of the time given for trying out the Plant. Provided  however that if such  delay  is due to a  cause beyond  the control of the Vendor  such extension  shall not exceed  the number of months stated in paragraph 11 of the Appendix.

9.6	The daily use of the Plant  and  the amount  by which  the Guarantee period shall be reduced  if the Plant is used more intensively  are sated in paragraph 1 of the Appendix.

9.7	A fresh  Guarantee  Period  equal to that stated  in paragraph G of the Appendix  shall apply, under the same terms and conditions as those applicable  to the original Plant, to parts supplied in replacement of defective parts renewed in pursuance  of this clause. This provision shall not apply to the remaining parts of the Plant , the  Guarantee Period of which shall  be extended only by a period equal to the period during which the Plant is out of actions as a result of a defect  covered by this Clause. 

9.8	In order to be able to  avail himself of his rights under this clause  the Purchaser shall notify the Vendor in writing  without  delay of and defects  that have  appeared  and shall  give him  every  opportunity  of inspecting  and remedying them.

9.9	On receipt  of such  notification the Vendor shall remedy the defect forthwith and, save as mentioned  in paragraph 10 hereof, at his  own expense. Save where  the nature  of the defect is such that it is   appropriate to effect repairs on site,  the purchaser  shall return to the Vendor any part  in which  a defect  covered  by this Clause has appeared, for repair or replacement by the Vendor, and in such case  the delivery  to the Purchaser  of  such part properly repaired or a part in  replacement thereof  shall be  deemed to be a fulfilment  by the Vendor of his obligations under this paragraph in respect of such defective part.

9.10	Unless  otherwise agreed, the Purchaser  shall  bear the cost and risk of transport of defective parts  and of repaired  parts  or parts  supplied in replacement  of sub-defective  parts  between  the place where the Plant is situated and one of the following points;
(i)	the Vendor’s  works  if the Contract is “ex-works” of  F.O.R.
(II)	 the port from which the Vendor dispatched  the Plant  if the Contract  is F.O.B. F.A.S., C.I.F., or C.& F.
(iii)	in all other cases  the  frontier  of the  country  from  which  the Vendor  dispatched  the Plant.

9.11	Where in pursuance  of paragraph  9 hereof,  repairs  are required  to be effected  on site, the conditions covering  the attendance of the  Vendor’s   representatives on site shall be such as may be specially agreed  between the parties.

9.12	Defective  parts replaced  in accordance with this Clause shall  be placed  at the  disposal of the Vendor.

9.13	If the  Vendor  refuses  to fulfil his obligations under  this Clause or fails to proceed  with due  diligence after being  required  so to do, the Purchaser  may proceed to do the necessary work at the Vendor’s  risk and expense, provided  that he does so in  reasonable manner.

9.14	The Vendor’s  liability does not apply  to  defects   arising  out of materials  provided, or out of a design  stipulated, by the Purchaser.

9.15	The Vendor’s liability  shall apply only to defects that appear under the conditions of operation provided for by the Contract  and under proper use. It does  not cover defects due to  causes arising after the risk  in the Plant has passed in accordance with Calsue6. In  particular  it does not cover defects arising  from the Purchaser’s  faulty maintenance or  erection  or from alterations carried out without the Vendor’s consent in writing, or from repairs  carried out improperly  by the Purchaser, nor does it cover normal deterioration.

9.16	Save as in this Clause expressed, the Vendor shall be under  no  liability  in  respect  of defects after the  risk in the Plant has passed in accordance with Clause 6, even if such defects are due to causes existing before the  risk  so passed. It is expressly agreed that the Purchaser shall have no claim in respect, of personal injury or of damages to property not the subject-matter of the Contract or of loss or profit unless it is  shown  from the  circumstances  of the case that the Vendor has been guilty of gross misconduct.

9.17	“Gross Misconduct”  does not comprise  any and every  lack or proper care of skill, but means and act or  omission on the part of the Vendor implying either  a failure to pay due regard to serous consequences which a conscientious Contractor would normally foresee as likely  to ensure, or  a deliberate disregard of any consequences  of such act or omission.

10. Reliefs

10.1	The following shall be considered as  cases of relief if they intervene  after the formation of the Contract and impede its performance :Industrial disputes and any other circumstances (e.g. fire, mobilization, requisition, embargo, currency  restrictions,  insurrection, shortage  of materials and restrictions,  insurrection,  shortage of transport, general shortage  of materials  and restrictions in the use of power) when such other circumstances  are beyond  the  control of the parties. 

10.2	The party wishing to claim relief by reason of any of the said circumstances  shall notify  the other party in writing without delay on the intervention and on the cessation  thereof.

10.3	The effects of the said circumstances, so far as they affect the timely performance  of their obligations by the parties, are defined in Clauses 7 and 8. Save as provided in Paragraph 7.5,7.7 and 8.7., if by reason  of any of the said circumstances, the performance of the Contract within a reasonable time becomes impossible, either party shall be entitled to terminate  the contract.

10.4	If the  Contract is terminated in accordance with paragraph 3 hereof, the division of the expenses incurred  in respect of the Contract shall be determined  	 by agreement  between  the parties.

10.5	In default of agreement it  shall be determined by the arbitrator which party has been prevented from performing his obligations  and the party shall bear the whole of the said expenses. Where  the Purchaser is required  to bear the whole of the expenses and has before termination of the Contract paid to the Vendor more than the Vendor’s expenses, the Purchaser shall be entitled to recover the excess.

If the  arbitrator determines that both parties have been prevented from performing their obligations, he shall apportion the said  expenses between the parties  in such manner as to him seem  fair and reasonable, having regard to all  the circumstances of the case.

10.6	For the purposes of this Clause “expenses”  means actual out-of-pocket expenses reasonably  incurred, after both parties shall have mitigated their losses as far as possible. Provided that as respects Plant delivered to the Purchase the Vendor’s expenses shall be deemed to be that part of the price payable under the Contract which is properly attributable thereto.

11.	Limitations of damages

11.1	Whether either party is liable in damages to the other these  shall not exceed the damage which  the party in default  could reasonably have foreseen at the time of the formation of the Contract.

11.2	The party who sets up a breach of the Contract shall be under a duty to take all necessary measures  to mitigate  the loss which has occurred   provided  that he can do so without  unreasonable  inconvenience, or cost. Should  he fail to do so, the party guilty of the breach may claim a reduction in the damages.

12. Rights at termination
12.1	Termination of the Contract , from whatever cause arising, shall be without prejudice to the rights of the parties accrued under the Contract up to   the time  of termination.

13.  Arbitration and Law applicable
13.1	Any dispute arising out of the Contract shall be finally  settle, in accordance  with the Rules of Conciliation  and Arbitration of the International  Chamber of Commerce, by one or more arbitrators designated in conformity with those Rules.

13.2	Unless otherwise agreed, the Contract shall be governed by law of the Vendor’s country.

13.3	If  the parties  expressly so agree, but not otherwise, the arbitrators shall, in giving their ruling, act as amiable compositors.

APPENDIX
(To be completed by parties to the Contract)
									Clause
A.	Percentage to be deducted for each week’s delay	7.3…..per cent
B.	Maximum  percentage which the deductions above	7.3…. per cent
C.	Maximum amount recoverable for non-delivery		7.5….(in the agreed 										currency)

D.	Maximum  amount recoverable on termination 		7.7….(in the agreed
	by Vendor for failure to take delivery or make 			currency)

E.	Rate of interest on  overdue payments			8.7……per cent
									Per annum
F.	Period of delay in payment authorising			8.7…..months	
termination by Vendor.
G.	Guarantee period  for original Plant and			9.7…….months 
	Parts  replaced or renewed				9.5……..months

H.	Maximum extension of guarantee period 		9.6…….hours/day
	(1)	Daily use of  Plant
	(2)	Reduction of Guarantee period			9.6…………….
		 for more  intensive use.