WHAT IS THE INTERNATIONAL SALES

CONTRACT?
The international sale contract is based on the
agreement between two parties (importer and exporter)
domiciled in two different countries that undertake to
exchange a merchandise for the payment of a price.
This contract must include data such as price, quantity,
incoterms (commercial terms or rules of common use in
foreign trade, published by the ICC and which establish
the distribution of risks, obligations and costs between the
exporter and importer in a sale and purchase international
 ), quality, technical specifications, destination port, etc.
 The international sales contract is increasingly
common since international sales has become a regular
in companies, since it is the way they have to 
internationalize and operate throughout the world.
 This type of contract is regulated by the United Nations
Convention that took place in Vienna on April 11, 1980.
This agreement, agreed by 75 countries, specifies that it
is not applicable to goods for personal use, that is,
family or domestic use. , as well as for purchases made
at auctions.
 In addition to the Vienna Convention, the regulatory
framework of the international sales contract is configured
by the Principles of European Contracting Law and the
Principles of International Commercial Contracts.
 Regarding the description of the merchandise that is carried
out in the international sales contract , the more detailed
the minor the problems that exist when the buyer receives
the merchandise. The quantity and quality of the product
must be included, as well as whether it contains anything
special, the way in which it is to be delivered and the
presentation of the merchandise.
REGARDING THE OBLIGATIONS THAT MUST BE TAKEN
INTO ACCOUNT BY BOTH THE SELLER (THE COMPANY
THAT EXPORTS) AND THE BUYER (THE COMPANY THAT
IMPORTS) ARE THE FOLLOWING:
 The obligations of the seller or exporter are: first, the
delivery of the merchandise; then transfer ownership; deliver the
documents related to the merchandise as established in
the international sales contract and in the Vienna
convention; transportation if so agreed in the contract; and the
identification of the goods.
 For their part, the obligations of the buyer or importer are:
first, the payment of the merchandise and then its receipt. In the
event that the buyer does not fulfill his obligations, the seller
must demand that the buyer fulfill the obligations, declare the
contract terminated or demand compensation for damages for
breach of the contract.
 In short, it is convenient to be aware of all the
fundamental elements that have to be agreed
between the two parties (buyer and seller) in
an international sale . The elaboration of a
good international sales contract in a complete
way will avoid the unnecessary responsibility of
some unforeseen risks and will facilitate the
development of the international activity of the
company.
NOW, LET´S REMEMBER SOME
ORGANISM OF THE INTERNATIONAL
TRADE…
 HAGUE CONFERENCE ON PRIVATE INTERNATIONAL LAW
 UNIDROIT ( INTERNATIONAL INSTITUTE FOR THE UNIFICATION OF PRIVATE
LAW)
 UNCITRAL (UNITED NATIONS COMMISSION ON INTERNATIONAL TRADE LAW)
 OCDE (The Organization for Economic Co-operation and Development)
 IMF (The International Monetary Fund)
 WTO (WORLD TRADE ORGANIZATION)
 ICC (INTENATIONAL COMMERCE CHAMBER)
 WCO (WORLD CUSTOMS ORGANIZATION)
 IMO (International Maritime Organization)
 WHAT ARE INCOTERMS RULES?
 The Incoterms rules are the world’s essential terms of
trade for the sale of goods. Whether you are filing a
purchase order, packaging and labelling a shipment
for freight transport, or preparing a certificate of
origin at a port, the Incoterms rules are there to guide
you. The Incoterms rules provide specific guidance to
individuals participating in the import and export of
global trade on a daily basis.
 WHO PUBLISHES THE INCOTERMS RULES?

 Since its founding in 1919, ICC has been committed to the

facilitation of international trade.
 Different practices and legal interpretations between traders
around the world necessitated a common set of rules and
guidelines. As a response, ICC published the first Incoterms®
rules in 1936. We have been maintaining and developing them
ever since.
 As ICC celebrates its Centenary in 2019, the world business
organization is pleased to announce the publication
of Incoterms® 2020. The newest edition of the Incoterms® rules
will help prepare business for the next century of global trade.
 WHAT DOES “INCOTERMS” STAND FOR?

 “Incoterms” is an acronym standing for international commercial terms.

“Incoterms” is a trademark of International Chamber of Commerce, registered
in several countries.
 The Incoterms rules feature abbreviations for terms, like FOB (“Free on
Board”), DAP (“Delivered at Place”) EXW (“Ex Works”), CIP (“Carriage and
Insurance Paid To”), which all have very precise meanings for the sale of goods
around the world.
 These terms hold universal meaning for buyers and sellers around the world. If
you are a financial analyst in the City of London, then you might associate the
acronym “FCA” with the United Kingdom’s Financial Conduct Authority.
However, for importers and exporters around the world, FCA are the initials
used for “Free Carrier,” or the seller’s obligation to deliver the goods to the
carrier nominated by the buyer at the seller’s premises or another named
place.