InternationalTradePractices

TextBook:

InternationalTradePractices

（SecondEdition)《國際貿易實務》（英文版）（第二版）帥建林編著對外經濟貿易大學出版社

2007年9月，第一版

2012年9月，第二版ContentsPart1OverviewPart2TermsofInternationalTradePart3InternationalTradeProcedurePart4TradeFormsPart1OverviewBird-eyeView,orTiger-eyeView?Chapter1IntroductiontoInternationalTradeChapter2InternationalTradePolicyChapter3TradeBlocandTradeBlockChapter4WTO:ANavigationGuideChapter1IntroductiontoInternationalTrade1.1WhyDoCountriesTrade?TheOriginofInternationalTradeResourceReasonsEconomicReasonsPreferenceReasonsOtherReasons1.2HowIsInternationalTradeMeasured?BalanceofPaymentsFDI

Whatistheoriginofinternationaltrade?Thestoryofthecavemantakesplaceonaninternationalbasis.Whytradewithothernations?AdvantagesInternationaltradeleadstomoreefficientandincreasedworldproduction,thusallowingcountries(andindividuals)toconsumealargerandmorediversebundleofgoods.Anationpossessinglimitednaturalresourcesisabletoproduceandconsumemorethanitotherwisecould.theestablishmentofinternationaltradeexpandsthenumberofpotentialmarketsinwhichacountrycansellitsgoods.Theincreasedinternationaldemandforgoodstranslatesintogreaterproductionandmoreextensiveuseofrawmaterialsandlabor,whichinturnleadstogrowthindomesticemployment.Competitionfrominternationaltradecanalsoforcedomesticfirmstobecomemoreefficientthroughmodernizationandinnovation.WhyTradeWithOtherNations?

ImportanceSomenationsexportonlytoexpandtheirdomesticmarketortoaideconomicallydepressedsectorswithinthehomeeconomy.Othernationsdependontradeforalargepartoftheirnationalincomeandtosupplygoodsfordomesticconsumption.Inrecentyearsforeigntradehasalsobeenviewedasameanstopromotegrowthwithinanation'seconomy.Developingcountriesandinternationalorganizationshaveincreasinglyemphasizedsuchtrade.Chapter1.2HowIsInternationalTradeMeasuredHowIsInternationalTradeMeasuredBalanceofTradeBalanceofPaymentsFDIBalanceofTradeThebalanceoftradeisanation’srelationshipofexportstoimports.favorablebalanceoftrade=tradesurplusunfavorablebalanceoftrade=tradedeficit

BalanceofPayments

Thebalanceofpayment=thedifferencebetweenmoneycomingintoacountryandmoneygoingoutofthecountry+moneyflowscomingintoorleavingacountryfromotherfactors.favorablebalanceofpaymentsVSunfavorablebalanceofpaymentsAboutFDITheBalanceofPaymentrelationshipbetweentheamountofmoneyanationspendsabroadandtheincomeitreceivesfromothernations.ThebalanceofpaymentsisofficiallyknownastheStatementofInternationalTransactionsandincludestwomainaccounts:First,thecurrentaccount,tracksactivityinmerchandisetrade—exportingandimporting;incomeearnedfrominvestmentsabroad;moneypaidtoforeigninvestors;andtransactionsonwhichthegovernmentexpectsnoreturns.Second,thecapitalaccount,tracksbothloansgiventoforeignersandloansreceivedbycitizens.Becausethebalanceofpaymentsisonereflectionofanation'sfinancialstabilityintheworldmarket,theInternationalMonetaryFund(IMF)usestheseaccountstomakedecisionssuchasqualifyingacountryforaloan.TheIMFalsoprovidestheinformationtoitsmemberssothattheycanmakeinformeddecisionsaboutinvestmentsandtrade.Thebalanceofpaymentscanbeusedasanindicatorofanation'seconomicstability.Changesinthebalanceofpaymentscanaffecttheexchangerateofacountry'scurrency.Forexample,adeficitinmerchandisetrademeansthatthecurrencyofthatnationisfloodingtheworldeconomy,sinceitisbeingusedtobuytheimportsthatcausethedeficit.Unlessgovernmentcontrolsareused,thevalueofthecurrencywillmostlikelydepreciate.FDIForeignDirectInvestment(FDI)isthebuyingofpermanentpropertyandbusinessinforeignnations.Itcantaketheformofeitherdirectorportfolioinvestment.Directinvestmentoccurswhenacquisitionofequityinterestinaforeigncompanyismade.Thisinterestmayvarybetweenasmallpercentageandacontrollinginterestofacompany’sequity.(Ownershipofmorethan50%isnotnecessaryinsecuringacontrollinginterestinacompany).Controllinginterestinaforeigncompanyrepresentsahighlevelofcommitmenttoforeignoperationsandisusuallyaccompaniedbypersonnelandtechnologytransfersabroad.Theappealofdirectinvestmentlieswiththeaccesstomarketandresourcesaswellasrationalizationofglobalproductionaffordedbysuchanarrangement.Incontrast,portfolioorindirectinvestments,arechieflymotivatedbyshort-tomedium-termprofits.Theymayincludeequityinvestmentsthatdonotinvolveanactiveroleinmanagementorbondsandotherdebtinstrumentsissuedbyforeigncompaniesandgovernments.Asfinancialmarketsaroundtheworldbecomeincreasinglyintegratedinrecentyears,internationalportfolioinvestmentshavebecomepopularwithinvestorsasavehicleofdiversificationfurtherhasteningtheprocessofinternationalfinancialintegration.More…TheReasonsforFDIThedeclineofbarrierstoforeignownershipinmostcountriesoftheworld.LiberalizationoftradeandfinancialmarketsDeclineintransportationandcommunicationcoststhatresultedfromtechnologicalbreakthroughs.TheReactionstoFDIFDIhashistoricallybeencontroversial,especiallyinthereceivingcountry’spointofview.RadicalviewsMiddle-groundviewsPositiveviewsRadicalviews:(ThishastodowiththeexperienceofmanyformercoloniesoftheWesternindustrialcountries.)Contractualtermsbasedonunequalbargainingsituations.Createdependenceoftheemergingcountryonthemarketknowledgeandtechnologyoftheforeigninvestor.Middle-groundviews:welcomethetechnologyandskillstransferbutwatchfultoavoidsomeofthecosts.(e.g.thelossofinfluenceasdecisionsaremadeabroadregardingthedismissalofworkersortheclosureofaplant.)Positiveviews:encouragesfreetrade;transfersnewtechnologies;servesasachannelforlocalfirmstointernationalizeindirectly;generatespositivespilloverofideas,includingopeningofnewchannelsofinformationflows;increasescompetition,henceinnovationandproductivity.Chapter2InternationalTradePolicyImportTariffNon-tariffBarrierstoImportsExportTaxesExportSubsidiesImportTariffProtectiveTariffisdesignedtoraisetheretailpriceoftheimportedproducts

sothatdomesticgoodssothatdomesticgoodswillbemorecompetitiveandforeignbusinesswillbediscouragedfromshippingcertaingoodsintothecountry.ArevenuetariffisdesignedtoraisemoneyforthegovernmentTariffDutiesSpecificDuties:specificdutiesareleviedattherateofsomuchperunit,pound,kiloorgallon.AdvaloremDuties:advaloremdutiesareleviedonthebasisoftheproduct’svalue.CompoundDuties:compounddutiesareacombinationofspecificandadvolumeduties.Non-tariffBarrierstoImportsANon-tariffbarrierstoimportsisanypolicyusedbythegovernmenttoreduceimports,otherthantariffonimports.Limitingthequantityofimports.Increasingthecostofgettingimportsintothemarket.Creatinguncertaintyabouttheconditionunderwhichimportswillbepermitted.ImportQuotasVoluntaryExportRestraint(VER)OtherNon-tariffBarriersProductsStandardsDomesticContentRequirementGovernmentProcurementPoliciesRed-TapeBarriersDomesticContentRequirements:adomesticcontentrequirementmandatesthataproductproducedandsoldinacountrymusthaveaspecifiedamountofdomesticproductivevalue,intheformofwagepaidtolocalworkersormaterialandcomponentsproducedwithinthecountry.GovernmentProcurementPolicies:agovernmentprocurementpoliciesrequiresthataspecifiedpercentageofpurchasesbyagovernmentbemadefromdomesticfirmsratherthanforeigncountries.Red-TapeBarriersrefertocostlyadministrativeproceduresrequiredfortheimportationofforeigngoods.ExportTaxesAnexporttaxisataxcollectedonexportedgoods.Aswithtariffs,exporttaxescanbesetonaspecificoranadvalorembasis.ExportsSubsidiesExportsubsidiesarepaymentmadebythegovernmenttoencouragetheexportofspecifiedproducts.DomesticsupplyDomesticdemandPricefloorsFloorpriceShortfallofsupplyEEPDEIPChapter3TradeBlocandTradeBlock3.1TradeBloc3.2TradeBlockTradeBlocFourMajorTradeBlocs:theEU,NAFTA,MERCOSUR,andASEANTypesofbloc:Free-tradearea,Customsunion,CommonMarket,EconomicunionFeaturesoftradeblocRolesandFunctionofTradeBlocsToestablishsomeformofregionalcontrolregardingtradeinterestofnationswithinthatregionToestablishtariffsthatprotectintra-regionaltradeform“outside”forcesTopromoteSouth-to–SouthtradeTopromoteeconomicandtechnicalcooperationamongdevelopingcountriesMore…TradeBlockTradeblocks,alsocalledtradeembargoes,isaformofeconomicsanctions.Itisaprohibitionuponexportsorimports,eitherwithrespecttospecificproductsorspecificcountries.WaystoPerformTradeBlockLongHistoryofTradeBlockEffectsofTradeBlockChapter4WTOANavigationGuideWhatisWTO?HowDoesItWork?WTO:Objectives,FunctionsandBasicPrinciplesWTOAgreement:ANavigationGuide4.1WhatisWTO?BriefIntroductionWTOandGATTWWW.WTO.ORG4.2HowWTOworks?Decision-makingprocessTheSecretariatMembership4.3Objectives,FunctionsandBasicPrinciplesObjectives:raisingstandardsoflivingandincomes,ensuringfullemployment,expandingproductionandtrade,andoptimaluseoftheworld’sresourcesFunctions

tofacilitatetheimplementation,administrationandoperationoftheUruguayRoundlegalinstrumentsandofanynewagreementsthatmaybenegotiatedinthefuture.toprovideaforumforfurthernegotiationsamongmembercountriesonmatterscoveredbytheagreementsaswellasonnewissuesfallingwithinitsmandate.toberesponsibleforthesettlementofdifferencesanddisputesamongitsmembercountries.toberesponsibleforcarryingoutperiodicreviewsofthetradepoliciesofitsmembercountries.BasicPrinciplesMFNNationalTreatmentTransparencyPredictableandGrowingAccesstoMarketsPromotingfaircompetitionPart2TermsofInternationalTradeChapter5InternationalTradeTermsChapter6TermsofCommodityChapter7InternationalCargoTransportChapter8CargoInsuranceChapter9TermsofPriceChapter10InternationalPaymentsChapter11Claims,ForceMajeureandArbitration

AboutPart2TwocriticalelementsofanyinternationalsalescontractaretheTermsofSaleandtheTermsofPayment.TermsofSaledefinetheobligations,risks,andcostsofsellerandbuyerforthedeliveryofgoods.Forexample:atwhatpointinthedeliveryprocessdoobligations,risks,andcostsshiftfromthesellertothebuyer?Asaseller,wheredoyouwantthemtoshifttothebuyer?WhatisamorepreferableTermofSaleinlightoftheTermofPaymentthathasbeennegotiated?IftheTermofSaleisFCAorFOB,whopaysaterminaloperatorforstorageofcargoifthebuyer’scarrierfailstoloadthegoodsasscheduled?AsChapter5presentsTermsofSalewewillanswertheseandmanymorequestionsforyou.WewilldefineandexplainthethirteenTermsofSalefoundinINCOTERMS2010,whattheymeanandhowbesttoapplythemtoreal-lifesituations.(tobecontinued)Internationalsalestransactionspresenttobothbuyersandsellerselementsofrisknotfoundindomesticsales.LetPart2inourcoursetakeyouthroughtheadvantages,risksandmotivationsofbuyersandsellersinnegotiatingandagreeinguponaparticularpaymentterm.Wewillgostep-by-stepthroughtheLetterofCreditandDocumentaryCollectionsprocesstoprovideyouanunderstandingofhowtheseprocessesworkandwhatthepitfallsare.WewillreviewkeyelementsofUCP600andURC522,theconventionsgoverninghowbankswillhandleL/CsandCollections.

CaseStudyCIForNot?AChineseexporterexported500M/TwalnuttoaCanadianimporteronthebasisofUS$4,800perM/TCIFQuebec.Asitisaseasonalcommodity,theimporterrequiredandbothpartiesagreedtostipulatethefollowinginthecontract.L/CIssuingDate:tobeissuedbytheendofSeptember.Shipment:NotlatethanOct.31,partialshipmentandtransshipmentprohibited.ArrivalDate:NotlatethanNov.30.Otherwise,thebuyerisentitledtorefusethegoods.TermsofPayment:Draftat90T/DunderL/C.Duetothebadweather,thelinerarrivedatQuebeconDec.5.Consequently,theimporterrefusedtotakethedeliveryofthecargounless20%discountofthetotalvalueofthegoodswasmadeforthelossincurredtotheimporter.Afterpainfulnegotiations,thetransactioncametoendwiththeexporter’slossof$360,000bythediscountof15%ofthetotalvalueofthegoods.Chapter5InternationalTradeTerms5.1GeneralizationRoleofInternationalTradeTermsInternationalTradeUsagesWarsaw-OxfordRules1932RevisedAmericanForeignTradeDefinitions1941InternationalCommercialTermsIncoterms2010vs.Incoterms2000DifferencebetweenIncoterms2000andIncoterms20105.2AGuidetoIncoterms2010EXW

ExWorks(…namedplace)FCA

FreeCarrier(…namedplace)FAS

FreeAlongsideship(…namedportofshipment)FOB

FreeonBoard(…namedportofshipment)CFR

CostandFreight(…namedportofdestination)CIF

Cost,InsuranceandFreight(…namedportofdestination)CPT

CarriagePaidTo(…namedportofdestination)CIP

Cost,InsurancePaidTo(…namedportofdestination)DAT

DeliveredAtTerminal(…namedterminalatportorplaceofdestination)DATtermmeansthatthesellerdeliverswhenthegoods,onceunloadedfromthearrivingmeansoftransport,areplacedatthedisposalofthebuyeratanamedterminalatthenamedportorplaceofdestination.“Terminal”includesanyplace,whethercoveredornot,suchasaquay,warehouse,containeryardorroad,railoraircargoterminal.Thesellerbearsallrisksinvolvedinbringingthegoodstoandunloadingthemattheterminalatthenamedportorplaceofdestination.Thepartiesarewelladvisedtospecifyasclearlyaspossibletheterminaland,ifpossible,aspecificpointwithintheterminalattheagreedportorplaceofdestination,astheriskstothatpointarefortheaccountoftheseller.Thesellerisadvisedtoprocureacontractofcarriagethatmatchesthischoiceprecisely.Moreover,ifthepartiesintendthesellertobeartherisksandcostsinvolvedintransportingandhandlingthegoodsfromtheterminaltoanotherplace,thentheDAPorDDPrulesshouldbeused.Example:DAT,TerminalXYZ,CharlesdeGaulleAirport,Paris,France,Incoterms2010

DAP

DeliveredatPlace(…namedplaceofdestination)DAPtermmeansthatthesellerdeliverswhenthegoodsareplacedatthedisposalofthebuyeronthearrivingmeansoftransportreadyforunloadingatthenamedplaceofdestination.Thesellerbearsallrisksinvolvedinbringingthegoodstothenamedplace.Thepartiesarewelladvisedtospecifyasclearlyaspossiblethepointwithintheagreedplaceofdestination,astheriskstothatpointarefortheaccountoftheseller.Thesellerisadvisedtoprocurecontractsofcarriagethatmatchthischoiceprecisely.Ifthesellerincurscostsunderitscontractofcarriagerelatedtounloadingattheplaceofdestination,thesellerisnotentitledtorecoversuchcostsfromthebuyerunlessotherwiseagreedbetweentheparties.Example:DAP,CustomsWarehouse,PortofStockholm,Sweden,Incoterms2010DDP

DeliveredDutyPaid(…namedplaceofdestination)5.4IncotermsandContractsSinceIncotermsarestandarddefinitions,theyareusedincontractstoreduceconfusionandpreventtradershavingdifficultyunderstandingtheimportrequirementsandshippingpracticeusedinothercountries.Mostcontractsfrom1January2010refertoIncoterms2010,unlessthesellerandthebuyeragreetouseanearlierversion.Contractsdatedbefore1January2010arestillblindedunderIncoterms2000.Chapter6

TermsofCommodity6.1NameofCommodity6.2QualityofCommodity6.3QuantityofCommodity6.4PackingofCommodity6.5CommodityInspectionandCustomsFormalitiesLearningObjectivesTounderstandtheimportanceofclausesofquality,quantity,packingandpriceinasalescontractTolearnthemethodsofexpressingthequalityofgoodsinasalescontractTolearndifferentweightcalculationmethodsTolearnthemarksontransportpacking6.1

NameofCommoditySpecifythenameofproductunder“NameofCommodity”thatisamaincomponentoftheDescriptionofGoodsThedeliverymustbeinaccordancewiththeagreednameinthecontractThenameofproductmustbespecific,widelyaccepted,agreedbybothpartiesandclearlystipulatedinthecontractTosomeproducts,theselectionofthenameofproductsshouldbeverycautious,eitherreducingcustomsduties,orsavingfreight.e.g.CementPortlandCement425#6.2QualityofCommodityImportanceAccordingtoUNConvention,thesellermustdeliverthegoodsasrequiredbythecontract.Otherwise,thebuyermayclaimdamages,requiredeliveryofsubstitutegoods,orrequirethesellertoremedy,orevenrejectthegoodsandcancelthecontract.TechnicalRequirementsFamiliarizeourselveswiththeinternationalstandard,suchasISO9000series.ExportsmustbeupgradedwithtimesWaystodescribethequalityofgoods:SalesbySampleSalesbySpecification,GradeorStandardSalesbyBrandorTrademarkSalesbyDescription,DrawingorDiagramQualityClausesinContractFlexiblewording/stipulation:“thequalityofthegoodsshippedtobeequal/similartothesample”FlexiblequalityrangeRangeQualityTolerance,alongwiththeflexibleprice,e.g.“Soybean,iftheoilcontentofthegoodsshippedis1%higher,thepricewillbeaccordinglyincreasedby2%”

6.3QuantityofcommodityUnitofMeasurementMetricSystem:kg.,M.,sq.m.l.,M/T,ounce,etcInternationalSystemofUnits(SI)BritishSystem:Pound,Yard,etc.U.S.SystemCalculationWeightByGrossWeightByNetWeight,/GrossforNetByConditionedWeightByaveragetareBycustomarytareBycomputedtareMoreorLessClause6.4PackingofCommodityOuterPackingTypesofPackingInnerPackingMarkingofGoodsShippingMarkAdditionalMarkIndicative/WarningMarkNeutralPackingTheoriginoftheproductisnotshownontheinnerandouterpackagesattherequestofthebuyer.Purpose:Promotion;Clearoffthetradebarrierinsomeregions,and/orfortheEntrepotTrade(轉口貿易)TwoKinds:NeutralPackingwithDesignatedBrand(定牌)NeutralPackingwithoutDesignatedBrand6.5CommodityInspectionandCustomsFormalities

WhereandwheninspectionundergoesInspectionandre-inspectionLandingQuality/Weight(Quantity)asFinalInspectionandRe-inspectionCommodityInspectionCertificateInspectionCertificateofQualityInspectionCertificateofWeightInspectionCertificateofQuantityMore…CustomsFormalitiesforExportsandImportsSpecificDutiesAdValoremDutiesCompoundDutiesChapter7InternationalCargoTransport7.1ModesofTransport7.2ClauseofShipment7.3MajorShippingDocumentsChapter7InternationalCargoTransportLearningObjectivesTolearnthemodesoftransport,exp.OceantransportTounderstandthenatureoflinertransportTounderstandthemainfeaturesofB/LTounderstandthevariouskindsofB/LTounderstandthecontentsoftransportclause

7.1ModesofTransport

OceanCarriage(OceanShipping/MarineTransportation)ShipmentwithinafixedtimeperiodConferenceLineVesselsNon-conferenceLineVesselsTrampShipsAirTransportRailTransportRoadTransportInlandWaterwayTransportContainerTransportInternationalMulti-modalTransportAirtransportservices:ScheduledairlinesCharteredcarriersConsolidatedconsignmentsContainerTransportContainerizationistodistributemerchandiseinaunitizedform,suitedfortheocean,railandmultimodaltransport.FeaturesofContainerTransportOfferdoortodoorserviceSavelabors,loadingandunloadingchargesLowriskLesspackingFasterSeveralOptionsforContainerCalculation7.2ClauseofShipmentTimeofShipmentPortofShipmentandPortofDestinationShippingAdvicePartialShipmentandTransshipmentLaytime,DemurrageandDispatchDaysofRunningDaysWeatherWorkingDaysof24HoursWeatherWorkingDaysof24ConsecutiveHours7.3MajorShippingDocumentsBillofLadingOtherDocuments:ConsignmentNote(forRailandRoad)AirWaybillCombinedTransportDocumentsBillofLadingConceptMajorShippingDocuments:B/L,varioustypesBillofLading:ConceptWhatisit?AreceiptforcargoAcontracttodelivercargobetweencarrierandshipperOwnershipofcargoKeyelementsinB/L;studyaspecimenClausesinB/LStipulationsfromaB/LissuedbyCOSCO:Shippedonboardthevesselnamedaboveinapparentgoodorderandcondition(unlessotherwiseindicated)thegoodsorpackagesspecifiedhereinandtobedischargedattheabovementionedportofdischargeorasneartheretoasthevesselmaysafelygetandbealwaysafloat.Theweight,measure,marks,numbers,quality,contentsandvalue,beingparticularsfurnishedbytheshipperarenotcheckedbytheCarrieronloading.Theshipper,ConsigneeandtheHolderofthisBillofLadingherebyexpresslyacceptandagreetoallprinted,writtenorstampedprovisions,exceptionsandconditionsofthisBillofLading,includingthoseonthebackhereof.Inwitnesswhereof,theCarrierorhisAgenthassignedBillsofLadingallofthistenoranddate,oneofwhichbeingaccomplished,theotherstostandvoid.MajorShippingDocuments:B/L,varioustypesShipped(OnBoard)B/LandReceivedforShipmentB/LCleanB/LanduncleanB/LStraight,blankandorderB/LDirect,transshipment,throughB/LLinerB/L,containerB/L,andcombinedtransportB/LLongformB/LandshortformB/LOnDeckB/L,staleB/L,ante-datedB/LandadvancedB/LB/L,varioustypesAsperthecargowhetheronboardornot:OnboardB/L,ShippedB/LReceivedforshipmentB/LAsperthecargowhetherinapparentgoodorderorconditionornot:CleanB/LUncleanB/LAsperhowtheidentificationofconsigneeismade:StraightB/LBlankB/LOrderB/LAsperthemodesoftransport:Direct,transshipment,throughB/LAsperthebusinessactivitybythecarrier:LinerB/LCharterPartyB/LContainerB/LPrintthephraseas“containerized”onthecommonB/LCombinedTransportB/LSuchitemsas“ContainerNumber”and“SealNumber”areaddedtothecommonB/LSuchwordingas“CombinedTransportB/LAcceptable”orthealikeshouldbeprinted,writteninL/CAsperthecontentsofstipulationsintheB/L:LongformB/LShortformB/LOtherkinds:OnDeckB/LStaleB/LAirWaybill(AWB)Aconsignmentnoteusedforthecarriageofgoodsbyair.SpecialRemarks:SharethecommonfeatureoftheseafreightB/L.But,itisNon-negotiable.Because:AWBisofastraightB/Lforitsshortenedvoyagebyair.Theexporterretainshis“rightofdisposal”ofthegoodsafterdispatchingthegoodstotheairlinercarrierandbeforeitsarrivalattheconsignee.Difference:ThroughB/L&CTD

TransportModes:ThroughB/Lisalwaysconnectedwithsea,usedforanytransportcombinedwithsea.CTDcanbeappliedtoatleasttwomodesoftransport,oranykindofcombinedtransport.Carrier:ThroughB/Linvolvesseveralcarriers.CTDinvolvesonlyonecarrierwhoisacombinedtransportoperator.Chapter8

CargoInsuranceChapter8InternationalCargoInsuranceLearningObjectives:TorealizetheperilsandlossesinoceantransportationTolearnthecoverageoftheOceanMarineCargoClausesTounderstandthewaysofstipulatinginsuranceclauseinSalesContractandtheimportandexportinsurancepracticeinChina.AFrontierKnowledge:tolearnabouttheExportCreditInsurance

8.1PartiestotheInsurance8.2MarineInsurance8.3InsuranceofLand,AirandPostalTransportation8.4FundamentalPrinciplesofCargoInsurance8.1PartiestotheInsurance

InsurerInsuredInsuranceBrokerClaimantMarineInsuranceTypesofRisks,LossesandExpensesCoveredScopeofInsuranceCoverageProceduresofMarineInsuranceRisksNaturalRisks:PerilsoftheSeaManmadeRisks:ExtraneousRisksLossesTotalLossActualTotalLossConstructiveTotalLossPartialLossGeneralAverageParticularAverageConstructiveTotalLossesDefinitionAninsurancelosswheretheexpenseofrecoveringorrepairingtheinsuredgoodswouldexceedtheirvalueafterthisexpenditurehadbeenincurred.HowtoadjustIntheadjustmentofconstructivetotallosses,thevalueofanyremainingsalvageabandonedtounderwritersmay,byagreement,betakenintoconsideration,withpaymenttotheassureduponanetbasis.Otherwise,underwriterspayfullinsuredvalueandmaythendisposeofthesalvagefortheirownaccount,providedtheyhaveelectedtoacceptabandonment.Ifthelosswasduetoseaperil,a“master’sprotest”(alsocalled“captain’sprotest”)willusuallyberequired.Thiscertifiesthefactthatunusuallyheavyweatherorotherexceptionalcircumstancewasencounteredduringthevoyageandisextendedtoconfirmthelossoftheshipmentinquestion.Inclaimsfortotalloss,itisespeciallynecessarythatafullsetofinsurancecertificatesandbillsofladingbesubmittedtotheinsurancecompanyrepresentative.GeneralAverageDefinitionSeeP.119Howtoadjust

Asthenameimplies,generalaverageclaimsaffectalltheinterestswhichstandtosufferafinanciallossifaparticularvoyageisnotsuccessfullycompleted.Thelossessuchcausedisbornebyalltheparitiesinvolved,e.g.ship,individualcargoowners.RemarksInactualpractice,generalaveragesresultmainlyfromstranding,fires,collisionsandfromengagingsalvageassistanceorputtingintoaportofrefugefollowingamachinerybre