REVIEW

Part 1 Concept review

Incoterms 2020x
1. What are some common misconceptions about Incoterms? When choosing a rule
in Incoterms 2020, what issues should be considered by contracting parties? (P.8-
Textbook-Xuân Minh )

- Using FOB or CIF for containerized cargo

- Confusing ornership and risk
- Using Delivered Duty Paid (DDP) without knowing import regulations
- Misunderstandings with CIF and CIP Incoterms
- Not being specific when naming places or destinations
- Not determining who pays the terminal handling charges
- Matching the wrong Incoterms with bank security requirements
- Being unfamiliar with import regulations of certain countries

2. Point out the seller’s and buyer’s obligations (Items A2-Delivery, A3-Transfer of
risk- and A4 Carriage) under FCA, Incoterms 2020.

Obligation Seller Buyer

A2 – Delivery - Delivers the goods to - Takes delivery of
the carrier or the goods when they
another person have been delivered
nominated by the under A2.
buyer at the named Lấy hàng khi được giao
point, if any, at the
named place in
the seller’s country.
Giao hàng cho người
vận chuyển hoặc
người khác do người
mua chỉ định tại địa
điểm chỉ định, nếu
có, tại địa điểm chỉ
định ở quốc gia của
người bán.
A3 – Transfer of risk - Bear all risks of loss - Bears all risks of
of or damage to the loss of or danage to
goods until they the goods from the
 have been delivered time they have been
in accordance with delivered under A2
A2. Chịu mọi rủi ro về mất
Chịu mọi rủi ro về mất mát hoặc hư hỏng
mát hoặc hư hỏng hàng hóa kể từ thời
hàng hóa cho đến điểm hàng hóa được
khi hàng được giao giao theo mục A2
theo quy định tại
mục A2.
 A4 – Carriage - Has no obligation to - Arrange for
the buyer to make a carriage.
contract of carriage.
Không có nghĩa vụ
với người mua về
việc lập hợp đồng
vận chuyển.

3. Point out the seller’s and buyer’s obligations (Items A2-Delivery, A3-Transfer of
risk- and A4 Carriage) under FOB, Incoterms 2020.

Obligation Seller Buyer

A2 – Delivery - Delivers the goods - Takes delivery of
either by placing the goods when they
them on board the have been delivered
vessel nominated by
under A2.
the buyer at the
loading point. Lấy hàng khi đã giao
Giao hàng bằng
cách đặt hàng lên
tàu do người mua
chỉ định tại điểm
bốc hàng.
A3 – Transfer of risk - Bear all risks of loss - Bears all risks of
of or damage to the loss of or danage to
goods until they the goods from the
have been delivered time they have been
in accordance with delivered under A2
A2.
Chịu mọi rủi ro về mất
mát hoặc hư hỏng
hàng hóa cho đến
khi hàng được giao
theo quy định tại
mục A2.
A4 – Carriage - Has no obligation to - Arrange for
the buyer to make a carriage.
contract of carriage.
Không có nghĩa vụ
với người mua về
việc lập hợp đồng
vận chuyển.
4. Point out the seller’s and buyer’s obligations (Items A2-Delivery, A3-Transfer of
risk- and A4 Carriage) under CIF, Incoterms 2020.

Obligation Seller Buyer

A2 – Delivery - Delivers the goods - Takes delivery of
either by placing the goods when they
them on board the have been delivered
vessel or by under A2 and
procuring the goods
receive them from
so delivered.
the carrier at the
 named port of
destination.
A3 – Transfer of risk - Bear all risks of loss - Bears all risks of
of or damage to the loss of or danage to
goods until they the goods from the
have been delivered time they have been
in accordance with delivered under A2
A2.

A4 – Carriage - Contract or procure a - Has no obligation to

contract for the the seller to make a
carriage of the contract of carriage.
goods fron the
agreed point
of delivery.

5. Point out the similarities and differences in seller’s and buyer’s obligations in CIF
and CIP rules under Incoterms 2020. (In terms of means of transportation, risk
transfer, contracting for carriage, main carriage, loading and unloading costs)

Similarities:
- Seller is responsible for:
+ Arranging carriage and insurance.
+ Loading cost at origin.
- Buyer is responsible for:
+ bearing unloading cost at destination if such cost is not included in a carriage contract
Differences:
CIF CIP
1 Mean of Sea or inland water way Any or multimodals
transportation
2 Point of cost When goods are placed on When goods are loaded onto
transfer board the vessel at the port the vehicle nominated by a
of shipment. buyer.
 3 Point of risk As above As above
transfer
4 Type of cargo Bulk cargo Containerized cargo

6. Point out the similarities and differences in seller’s and buyer’s obligations in
FOB and FCA rules under Incoterms 2020. (In terms of means of transportation,
risk transfer, contracting for carriage, main carriage, loading and unloading costs)

Similarities:
Seller is responsible for:
+ checking the goods before delivery
+ making customs clearance for export
+ bear all costs associated with an export licence.
Buyer is responsible for:
+ Arranging carriage.
Differences:
FOB FCA
1 Mean of Sea or inland water way Any or multimodals
transportation
2 Point of cost When goods are placed on When goods are loaded onto
transfer board the vessel at the port the vehicle nominated by a
of shipment. buyer.

3 Point of risk As above When the goods are delivered

transfer onto the first carrier.
 4 Type of cargo Bulk cargo Containerized cargo
5 Loading cost For seller’s account At seller’s premises: for
at origin seller’s account.
At another named place: for
buyer’s account.

7. Point out the similarities and differences in seller’s and buyer’s obligations in
DPU and DDP rules under Incoterms 2020. (In terms of means of transportation,
risk transfer, contracting for carriage, main carriage, loading and unloading costs,
import and export clearance)

Similarities:
- Use any means of transportation
- Risk to the goods transfers from the seller to the buyer at destination
- Seller is reponsible for contracting carriage and pay for carriage.
- Loading costs are for seller's account
- Unloading cost are for buyer's account.
Differences:
Item DAP DDP
Import Buyer Seller
clearance

Shipping documents
8. What is a commercial invoice? Subject to UCP 600, what provisions are required
for a commercial invoice? (P.96-Text book- Xuân Minh)

Commercial invoice is a document used in foreign trade.

 It is issued by the seller, that gives details and value of the goods to be sold.

- Its main content includes the name of seller and buyer; invoice No, date of the
invoice, descriptions of the goods, marking, unit and total price, terms of delivery and
payment.
Hóa đơn thương mại là chứng từ được sử dụng trong ngoại thương.
Nó được người bán phát hành, cung cấp thông tin chi tiết và giá trị của hàng hóa được
bán.
- Nội dung chính bao gồm tên người bán và người mua; Số hóa đơn, ngày lập hóa đơn,
mô tả hàng hóa, ký hiệu, đơn vị và tổng giá, điều kiện giao hàng và thanh toán.

- Subject to UCP 60, a commercial invoice:

+ must appear to have been issued by the beneficiary

+ Must be made out in the name of the applicant for the LC

+ Must be made out in the same currency as the L/C.

+ the descriptions of the goods must be in correspondence with those in the credit.

- Theo UCP 60, hóa đơn thương mại:

+ phải được xuất trình bởi người thụ hưởng

+ Phải đứng tên người nộp đơn xin LC

+ Phải được lập bằng loại tiền tệ giống với L/C.

+ mô tả hàng hóa phải phù hợp với mô tả trong thư tín dụng.
9. What is a Certificate of Origin (C/O)? What is the significance of C/O?

• It is issued by an authorized governmental agencies in the exporter's country as an

evidence of origin of the country's manufacture.
• Its contents must conform to the terms of the contract and letter of credit.
Significance of Certificate of Origin:
- It is used to get preferential tariff for importers.
- It ficilitates the importer to adhere to the rules and regulations of his country.
• Nó được cấp bởi cơ quan chính phủ có thẩm quyền ở nước xuất khẩu như một bằng chứng
về nguồn gốc sản xuất của nước đó.
• Nội dung của nó phải phù hợp với các điều khoản của hợp đồng và thư tín dụng.
Ý nghĩa của Giấy chứng nhận xuất xứ:
- Được sử dụng để hưởng ưu đãi thuế quan cho nhà nhập khẩu.
- Nó tạo điều kiện cho nhà nhập khẩu tuân thủ các quy tắc và quy định của nước mình.

10. What is a Bill of Lading? What are the functions of a Bill of Lading?
- It is issued by the shipping company or his agent or a forwarder to acknowledge the
receipt of cargo on board.
- This is an undertaking to deliver the goods in the same order and condition as
received by the consignee or his agent on receipt of freight.
- It is a very important document to the exporter as it constitutes a document of title to
the goods.
 What are the functions of a Bill of Lading?
• As a document of title to the goods
• As a receipt from the shipping company
• As a contract of carriage (transportation) of goods.
- Thẻ do hãng tàu hoặc đại lý hoặc người giao nhận phát hành để xác
nhận việc nhận hàng lên tàu.
- Đây là cam kết giao hàng theo đúng trình tự và tình trạng như đã nhận
cho người nhận hàng hoặc đại lý của người đó khi nhận cước vận chuyển.
- Đây là chứng từ rất quan trọng đối với người xuất khẩu vì nó cấu thành
chứng từ sở hữu hàng hóa.

Chức năng của vận đơn là gì?

• Là chứng từ sở hữu hàng hóa
• Là biên lai từ công ty vận chuyển
• Là hợp đồng vận chuyển (vận chuyển) hàng hóa
11. What is a surrendered B/L ? (Vận đơn điện giao hàng) When is this kind of B/L
applied?
Surrendered B/L is a B/L issued by carrier to forwarder company, which doesn't need the
Original B/L.
- It can also be issued by forwarder to real customer in case the shipper does not need
original B/L in their transaction.
- It is used in case of late arrival of the Original B/L and helps to release the D/O
(Delivery Order) at destination without original B/L to save cost and time and risk of
loss.

12. What is a clean Bill of Lading? What is a shipped on board Bill of Lading? What
is a received for shipment Bill of Lading?
- Clean B/L: It is a Bill of Lading which it indicates that there has been no defect in the
apparent order or condition of goods at the time of receipt or shipment of goods by the
shipping company.
- Received for Shipment B/L: It is a Bill of Lading which is issued when goods have
been given to the custody of the shipping company, but they have not been placed on
board.
- On Board Shipped B/L: It is a Bill of Lading which certilies that the cargo has been
received on board the ship.
13. What is an Airway Bill? What is the importance of an Airway Bill?
- It is also called Air Consignment Note.
- It is a receipt issued br an airline for the carriage of goods.
- It is not a document of title to goods and is not issued in negotiable form.
- Delivery of the goods is made to the consignee without the production of
airway bill.
 Importance of Airway Bill:
- It is a contract of carriage of goods between the consignor and airlines or his agent.
- It acts as a customs declaration form.
- It contains details of freight and so works as a freight bill.

14. What is an Insurance Policy? What is the importance of an Insurance Policy?

• An insurance policy is a legal contract between the insurance company (the insurer)
and the person(s), business, or entity being insured (the insured).
• This kind of documents is very important to help customer (the insured) overcome
financial crisis when they meet certain risk in business transaction.

International payment
15. Point out the similarities and differences between payment by clean
collection and documentary collection. Which one is more secure for the seller?
Similarities:
- Seller asks a bank in a buyer's country to collect money for him.
- Seller issues a draft to ask for a payment from the buyer.
Differences:
Payment Clean collection:
- Seller sends the goods and the shipping documents directly to the buver.
Therefore, risk of losing goods without getting fund from a buyer. It is riskier than
documentary collection.
Payment Documentary collection:
- Seller does not send the documents to the buyer. Ask the collecting bank to release
the documents to the buyer only when the buyer pays or accept to pay the draft. It
is more secure than clean collection.
15. Chỉ ra những điểm giống và khác nhau giữa thanh toán nhờ thu sạch và nhờ thu
chứng từ. Cái nào an toàn hơn cho người bán? Điểm tương đồng:
- Người bán yêu cầu ngân hàng ở nước người mua thu tiền hộ mình.
- Người bán phát hành hối phiếu yêu cầu người mua thanh toán.
Sự khác biệt:
Thu thập sạch:
- Người bán gửi hàng hóa và chứng từ vận chuyển trực tiếp đến người mua.
Vì vậy, có nguy cơ mất hàng mà không nhận được tiền từ người mua. Nó rủi ro hơn
việc thu thập tài liệu.
Thu thập chứng từ thanh toán:
- Bên bán không gửi hồ sơ cho bên mua. Yêu cầu ngân hàng thu chỉ phát hành bộ
chứng từ cho người mua khi người mua đã thanh toán hoặc chấp nhận thanh toán hối
phiếu. Nó an toàn hơn việc thu thập sạch.

16. What is payment by documentary credit? Why is it said that this method
can guarantee the rights of sellers and buyers against documents?
 Payment by documentary credit (Letter of credit), is a contractual agreement whereby the
isuing bank (importer's bank), acting on behalf of the customer (the importer or buyer),
promises to make payment to the beneficiary or exporter against the receipt of complying
stipulated documents.
Thanh toán bằng tín dụng chứng từ (Thư tín dụng), là một thỏa thuận hợp đồng, theo đó
ngân hàng phát hành (ngân hàng của người nhập khẩu), thay mặt khách hàng (người
nhập khẩu hoặc người mua), hứa sẽ thanh toán cho người thụ hưởng hoặc người xuất
khẩu khi nhận được các chứng từ tuân thủ, các văn bản quy định.
Why is it said that this method can guarantee the rights of sellers and buyers against
documents?
- Because if the seller can present the perfect shipping documents, he can get the
money from the issuing bank.
• And the bank guarantees the buyer in receiving the goods with quality, quantity at
the time of shipment in accordance with those stipulated in the shipping documents.
- Bởi vì nếu người bán xuất trình được bộ chứng từ vận chuyển hoàn hảo thì có thể
nhận được tiền từ ngân hàng phát hành.
Và ngân hàng bảo đảm cho người mua nhận hàng đúng chất lượng, số lượng tại thời
điểm vận chuyển theo đúng quy định trong chứng từ vận chuyển.
International Contracts
17. What are the essential clauses of a contract under Vietnamese Article 402
Civil Law 2005? (p.26-Textbook- Xuân Minh)

07 clauses:

(1) Object of the contract;

(2) Quantity and quality;

(3) Price and mode of payment;

(4) Time limit, place and mode of performing the contract;

(5) Rights and obligations of the parties;

(6) Liablity for breach of contract;

(7) Methods of resohing disputes;

18. What are the requisite conditions for an international sale of goods contract to
be valid under Vietnamese Commercial Law?

- It must be in writing
- The subject of a contract (the goods) must be legally imported and exported.
- Parties to contract must be capable of entering a contract. (legally registered
companies; competent parties)
- Must consist of essential clauses.

19. What is the common structure of an international sales contract?

An international sale contract is commonly divided into three major parts:

The preamble: Exchange of rights and duties, and Legal provisions for execution.

1. The preamble: Tite, Contract Number, place and date of parties' signatures, name and
legal address of the parties, background information, definitions clauses.

2. Exchange of rights and duties: Scope of supply, price, payment, delivery

- Scope of supply: commodity, quality, quantis, packaging and marking.

- Price: Unit and total price: Incoterms, packing costs, spare parts or accessories costs,
discounts (if any)

- Payment: (Time of payment, method of payment, documents related, penalty for late
payment)

- Delivery: (Time and place of delivery, Incoterms rule, penalty for late delivery, stale bill
of lading, partial and transhipment, advice of despatch,...)

3. Legal provisions for execution: applicable law, claim, entire agreement, total
liability, notices, settlement of disputes.

20. Name the measures to describe the “Commodity” clause in a sale contract and
give examples.

The principal format:

Trade name + scintifie name/origin/name of manufacturer/brand name/major
content/usage
Examples:
 • Frozen black tiger shrimp - Pennnues Monodon (Trade name +scientific name)
- Dalat wine, Bordeaux wine (Trade name+ Origin)
- Honda motobike, Matshushita washing machine, Motobike Future brand (Brand
name)
- Urea fertilizer, nitrogen 46% (Trade namet major content)
- Cereals as food for human consumption (Trade name + usage)

21. Name the measures to describe the “Quality” clause in a sale contract and give
examples.

• Sale by sample
• Sale by national category or standard
• Sale by specifications
• Sale by common accepted trade criteria
• Sale by major contents of the product
• Sale by " As is/seen"
• Sale by "Inspected and approved"
• Sale by technical documents
• Bán hàng theo mẫu
• Bán theo danh mục hoặc tiêu chuẩn quốc gia
• Bán theo quy cách
• Bán hàng theo tiêu chí thương mại được chấp nhận chung
• Bán theo nội dung chính của sản phẩm
• Bán theo "Như đã thấy"
• Bán hàng theo "Đã kiểm tra và phê duyệt"
• Bán hàng theo tài liệu kỹ thuật
22. Point out the common methods to settle disputes or conflicts and the advantages
and disadvantages of each method. (Armicable settlement,mediation, Arbitration,
Litigation)

- Ammicable settlenent: is the armicable settement of disputes by negotiations between

ontracting parties,

- Arbitration: is a procedure in which a dispute is submitted, by agreement of the parties,

to one or more arbitrators who make a binding decision on the dispute.

- Conciliation (Mediation): is a procedure of settlement by consultations of attoneys or

solicitors (lawyers)
 - Litigation: is the settlement by a court

22. Chỉ ra các phương pháp giải quyết tranh chấp, xung đột phổ biến và ưu, nhược điểm của
từng phương pháp. (Giải quyết tranh chấp, Trọng tài, Tranh tụng)

- Giải quyết bằng thương lượng: là giải quyết tranh chấp bằng thương lượng giữa các bên
tham gia,

- Trọng tài: là thủ tục trong đó tranh chấp được đưa ra, theo thỏa thuận của các bên, cho một
hoặc nhiều trọng tài viên đưa ra quyết định ràng buộc về tranh chấp.

- Hòa giải (Hòa giải): là thủ tục giải quyết thông qua việc tham khảo ý kiến của luật sư hoặc
luật sư (luật sư)

- Tranh tụng: là sự giải quyết của tòa án

23. What are the advantages of settlement by arbitration in comparison with
litigation?

ARBITRATION LITIGATION
- The procedure is simplier, faster, more - The procedure is more complicated,
cost-eflective and convenient (thủ tục longer, costly.(ngược lại)
đơn giản, nhanh, tiết kiệm chi phí, thuận - Conducted in public. (tổ chức
tiện) công khai)
- Conducted in private (tổ chức riêng - The dispute resolution based on the
law(giải quyết tranh chấp dựa trên luật
tư)
- The dispute resolution based on
contracts (giải quyết tranh chấp dựa trên
hợp đồng)