PROCEDURE FOR COMMODITIES DEALS

 

Important for all customers: Our company is international, headquartered in Geneva, Switzerland. It holds annual, renewable allocations for sugar from Brazilian refiners/producers and supply contracts with producers for other products; so we are able to offer you better prices.

Acceptable payment methods include :

• SBLC TRANSFERABLE / NON-TRANSFERABLE (FROM TOP 50 BANK) By SBLC 100% with our Company Fiduciary as first beneficiary, 100% Fully Cash-Backed, Irrevocable, CONFIRMED, Divisible, TRANSFERABLE / NON-TRANSFERABLE, Assignable and Unrestricted, Operative at sight at loading port via MT760 (Given as Guarantee only) – (Validity 365 +1 day)

• BLOCK FUND / BANK GUARANTEE MT-760 IN BUYER’S BANK ACCOUNT (FROM TOP 50 BANK) IN FAVOR OF SELLER OR SELLER’S FINANCIAL FIDUCIARY PARTNER via MT760 (Given as Guarantee only) - (Validity 365 +1 day)

• CASH DEAL BY TT-MT103 – DEPOSIT TO ORDER / BALANCE PAYMENT BY TT-MT103 AT LOADING PORT The buyer sends by TT-MT103 the amount representing 30% of the value of the month of delivery by boats or 40% of the value of the month of delivery by contenairs, as a deposit, then the remaining balance is released by TT-MT103 at the LOADING PORT against the set of documents of which the SGS

• DLC/LC TRANSFERABLE (FROM TOP 50 BANK) By LC 100 % with our Company Fiduciary as first beneficiary, AUTO REVOLVING, Cash-Backed, Irrevocable, CONFIRMED, Divisible, TRANSFERABLE and Unrestricted, Operative at sight at loading port via MT700 given as Guarantee only (Valid for 12 months)

 

General conditions:

• We require the payment guarantees to be issued by one of the Top 50 World Banks, see an example list here: https://www.relbanks.com/worlds-top-banks/assets. If no guarantee can be obtained, the acceptable method is CASH DEAL or ESCROW ACCOUNT (learn more).
• We can allow witness from the Buyer team to be present during the Q&Q (SGS) process at the loading port.
• Payment instrument must be addressed with our fiduciary as 1st beneficiary - no transferred instruments are accepted.
• SGS inspection at the loading port is the only reference for payment release – Buyers are welcome to appoint CIQ inspection at loading port (for chinese market)
• We don’t accept CIQ at destination port as a condition of transaction / payment condition: CIQ/CCIC inspection made at destination port is not a reference for payment release at destination port.
• We send CIF by default, except for Africa and sometimes in some cases, we do in FOB.
• If the buyer wants to open a financial instrument for the trial only (and after another financial instrument for the monthly contract), the financial instrument needed for the trial must be validity of 90 days with the following conditions: no 2% PB for trial orders.
• Past performance can be given together with 2% PB for transferable financial instrument received.

 

Important for Customers from China: GACC, AQSIQ and all of the requirements from the Chinese governments are issued to you at port of Loading in Brazil, as part of the process.

Important for Customers from Bangladesh CFR is not allowed by Brazilian port authorities. Only CIF - Cargo, Insurance, Freight.

 

Please note: MOQ / Minimum Order Quantity is 12.500 Metric Tonnes.

Vessels are 12.500, 25.000 and 50.000 MT respectively. Acceptable orders can be in the following range: 12.500, 25.000, 37.500, 50.000, 62.500, 75.000, 87.500, 100.000 MT and above.

 

Instructions for successfully completing an export business for commodities from Brazil

The process illustrated for a commodity trade business is shown in an optimal release and should be completed within 2 weeks. This is necessary because producers and suppliers have to keep price promises and have to keep the corresponding goods in stock.

This process flow is intended to ensure that the terms and conditions for the trade in goods are clear and understandable in advance for all parties involved in the transaction and that they are accepted before written and legally binding commitments are made.

The procedures don’t favor either the buyer or the seller, but only serve the successful completion of the transaction. It’s common for intermediaries and agents on both the buyer and seller sides to be involved in these commodity transactions.

 

Please note:

• We don’t participate in speculation or general price inquiries, therefore we only accept documents that are addressed to our company (H&E Signature SA).
• Submitted documents must be made out on company letterhead with address data so that the sender can be clearly identified.
• In the case of export transactions, all documents must be written or translated in English. Only the English language is legally valid.
• Submitted documents must be sent to us by email (contact.sales@he-signature.com).
• This procedure applies to export transactions and is not legally binding and can be extended or shortened.

 

1. Purchase intent (LOI – Letter of Intent)

A fully completed Letter of Intent (LOI) from the buyer or agent (mandate holder) contains all product information with the corresponding specifications and quantities, under which conditions (price, payment terms, delivery conditions, etc.) the buyer is willing to buy the goods.

Please note: Letters of Intent (LOI) without a target price will not be accepted.

This Letter of Intent (LOI) is checked by the seller or his agent and they decide whether the buyer’s conditions can be met or with what deviations. The buyer or his agent will be informed accordingly.
The parties involved now have the opportunity to negotiate mutual interests in order to reach an agreement. If no agreement is reached in this early phase of the negotiation, the LOI expires and the process is to be regarded as a failure.

In some cases, the producer or supplier also requires the buyer’s bank information, as normally only Letters of Credit from globally operating top 50 banks (top 50 world banks) are accepted for export transactions.

 

2. Offer (SCO – Soft Corporate Offer / FCO – Full Corporate Offer)

If agreement between the parties has been reached regarding the specification and conditions according to the Letter of Intent (LOI) and these have been understood, the buyer will receive an offer (SCO / FCO) from the seller or his agent. It usually also describes other processes and time periods relating to the conclusion of a purchase contract, delivery and payment.

The buyer side is usually given 3 to 5 days to check the offer (SCO / FCO) and send it back signed and stamped and to initiate all preparations for the next step (point 3). If the period expires, the seller is no longer bound by the offer.

 

3. Order (ICPO – Irrevocable Corporate Purchase Order)

After the signed and stamped offer (SCO or FCO) has been sent back by the buyer, the end buyer (final buyer) must issue an order (ICPO – Irrevocable Corporate Purchase Order) in which all agreed specifications, conditions and procedures are described as stated in the offer to express the firm intention to buy.

Along with the order (ICPO – Irrevocable Corporate Purchase Order), the buyer has to send his KYC/CIS (Know Your Client), as well a copy of the company register and a copy of the buyer’s passport (or the company’s legal representative) to the seller.

 

4. Contract (SPA – Sales & Purchase Agreement)

After receipt of the order (ICPO – Irrevocable Corporate Purchase Order) and the other documents from the buyer described in point 3, these will be checked by the producer / seller and the buyer will timely receive a corresponding contract (SPA – Sales & Purchase Agreement). The prerequisite for this is a positive review of the submitted documents and evidence of sufficient funds (POF – Proof of Funds) corresponding to the scope of the contract.

The buyer generally has 48 to 72 hours to review the Sales & Purchase Agreement (SPA). Ambiguities must be resolved at this point by mutual agreement as soon as possible.

Once the contracting parties have finally agreed on the details of the contract (SPA – Sales & Purchase Agreement), the buyer must sign and stamp the contract (SPA – Sales & Purchase Agreement) and send it back to the producer / seller by email. After a further check by the producer / seller, the buyer receives the contract (SPA – Sales & Purchase Agreement) via DocuSign service for the management of electronic signatures and digital transactions (https://www.docusign.com/) to countersigned by all parties. The set of documents electronically signed is deemed as having original value with all the associated legal and legal scope. it will therefore be a substitute for the original paper.

The further procedures can be found in the legally valid contract (SPA – Sales & Purchase Agreement) signed by both contracting parties. A delay in the processes agreed in the contract (SPA – Sales & Purchase Agreement) can lead to the termination of the contract if the contracting parties cannot find an amicable solution.