An export contract is an agreement of selling and buying goods by an exporter and importer respectively. The contract is between parties residing or conducting business in separate states. So apart from the general mutually agreed upon terms and conditions, the clauses and rules that are to be followed under the state law and federal law of both the countries should also be preferably mentioned so that there is total compliance by both the parties.
Points to be kept in mind while preparing an export contract:
- The export contract should start with the seller’s name and address and the buyer’s name and address both of them referred to as the parties of the contract.
- Descriptions of the goods should follow next as this is vital in conducting business between the two parties and developing a long term relationship between them.
- The delivery terms, dates and locations need to be a part of the export contract. This will form the basis of agreement between both the parties and they will create necessary supply chains and processes to suit this requirement.
- The price is one of the most important issues in an export contract. The price basis should be set forthright. It should specify whether the price is the total price, price per unit, and whether it includes tax, etc.
- Before the agreement is signed, it is essential to exchange certain documents that are applicable in an export-import business. Hence the documents exchanged or to be exchanged should be a part of the export contract.
- Clauses and statements should be present that lists the actions that can be taken if there is a failure to comply with the payment deadlines or a delivery date.
- Fundamental non-performance conditions should also be mentioned in the export contract.
- Rules that are applicable under a specific jurisdiction and law should be mentioned so that both the parties take care that no rule is violated or broken.