|
The respect of Contractual
Rules
Gérard Serfati, Chairman of the Brokers Committee
|
There are no more rules,
No more respect of contracts
|
There are
no more rules, no more respect of contracts; Why? Because there is no risk
or less risk than before for arbitration, less risk to be blacklisted and
every year our industry is looking more and more like a jungle where
everyone is applying his own rules.
As
brokers, we are supposed to trade our business and issue our contract mainly
as per the GAFTA terms but we have the feeling we are loosing time. The
contracts are nowadays reduced to a piece of paper that nobody is
reading nor respecting anymore.
If we have
taken the responsibility of this action with the support of brokers from
various countries, it is purely for the benefit of our industry.
Years ago,
a word was a word, a verbal confirmation was a real confirmation even
without a contract. If today we are facing and finding so many troubles,
it's may be because our rules are not anymore applicable to our trade, to
our business. We are working much faster that 10 or 15 years ago because
information is moving very quickly with the new technologies but in this
case we should also have the ability to settle our problems with equity
and at the same speed.
Some people
coming from various countries were expecting to attend the 2005 Convention
without being registered, saying that sitting in the hotel lobby will be
enough for them to meet customers. If such people coming from various
countries are acting this way, trying to save a registration fee for the
Convention, you can imagine, what they are able to do for business!!. How
our industry can accept to work with such companies ?
Herewith
are some comments received from our colleagues:
|
Our industry is too fragmented
There is a terrible lack
of ethics
Morality is becoming
optional
We could have an informal
"black list"
|
“In my
opinion, our industry is much too fragmented. Half my time, every day, is
solving problems, problems. Of course we should discuss with the trade at
the convention.”
“It seems
to me that there is a terrible lack of ethics in the trade and no one really
cares. Buyers are trying to buy goods as cheaply as possible and usually use
any means to do this, while, the sellers are trying to make more sales with
no attention to margin or risk. I really don’t see this situation changing
in the near future unless real measures are being taken.”
“-Possibilty and allowance from Gafta to establish a group of pulses brokers
specialized on arbitrations of pulses contracts. Persons, conditions,
fees......-Possibility of creating and controlling a "BLACK LIST" of buyers
and sellers under certain circumstances.”
“Everyday
more is evident that the morality in our market is really becoming optional
for many sellers and buyers.
For the
time being it would be interesting and important to create a strong group of
brokers to see if possible to create one "unfortunately" black list”
“Eventually
we could have an informal “black list” which we do not circulate
officially... we just report problems when we have a serious one. Important
is to get started”
|
“AS BROKERS/AGENTS WE SHOULD CARRY THE RESPONSIBILITY TO IMPROVE SUCH
RULES FOR THE BENEFIT OF THE MARKET, SEEKING AND USING COMPETENT
INTERNATIONAL LEGAL CONSULTANTS TO OBTAIN IN THE COURTS THE
NECESSARY SANCTIONS AND CARRY OUT EXECUTIONS. “ |
With the brokers committee who gives us a chance to be more represented at
the Cicils, we will have more chance to help our industry, and during the
last meeting of the Executive Committee, it has been agreed as follows:
All brokers
members of the CICILS-IPTIC will be able to give an advice as consultant to
buyers, sellers or brokers who are facing a particular problem.
It
could be done as follows:
|
First Step |
Anyone who needs an advice will consult the list of
brokers and will choose 3 of them as consultant. After getting their
advice, they will be free or not to follow their advice. |
|
|
I understand that most of you were may be expecting a stronger action,
but we have to go step by step all while aiming at a stronger action in
the future. |
|
Second Step |
Establish a blacklist. |
|
Despite this was requested by many of our members, it appears that,
after carefully studying the problem, a blacklist could be issued only
after a legal action of which our committee is not entitled to do so. |
|
|
Each of us in the industry, which has been facing a
bad case, could submit it to his consultant-brokers, who will pass it on
to the Executive Committee, either during the regular meetings, of by
mail in between 2 meetings. |
|
|
At that time the Executive Committee will decide if this problem, can or
not, be published on the CICILS-IPTIC website. |
|
|
If this procedure can work, then we will be able to
foresee in the future a real mediation committee which will have a much
more official role. |
|
|
|
|
Gafta new rules |
Considering the fact our rules must change as they
are not anymore applicable to our pulses trade, could we ask Gafta to
issue some new arbitration rules that would be much more applicable to
our industry of pulses with a much lower fees?. This should be in my
opinion the best and most practical solution. |
|
Or alternatively |
To work on a Cicils contract with an arbitration
clause leaving the choice to both parties to agree on an arbitration in
any country of their mutual choice. Of course it should be a country
getting a chamber of Arbitration or a commercial court. |
Definitely
without an easier arbitration procedure, our industry is not taking a right
direction. Let's give you an example :
Very
recently one of my supplier got a big problem with one of his buyer and
asked me for an advice because I was not concerned by this business so I
could be very neutral :
§
To make the story short, his buyer left goods on the pier without taking the
documents since 4 months.
§
The goods are still at the port of destination.. Finally my seller after
consulting a Gafta Arbitrator in his country decided to stop his action and
ship back the goods; Why ?
§
The arbitrary asked 12,000 dollars for starting, Gafta fees where 7,000
dollars and they did not know yet the fees requested by the lawyer in the
country of the buyer.
§
Consequently the seller has decided to ship back the goods.
§
Still for the same buyer who left another parcel of 3 containers beans at
the port, I have been called recently by one of our estimated colleagues in
order to try to resell these goods which where lying since 4 months on the
port. Including demurrages and various expenses this situation has a cost
160 dollars per metric ton to the seller.
§
Again no arbitration, Why ?
§
It ‘s too complicated and too expensive.
So
we
understand
better why our industry is becoming unfortunately a jungle.
We really
need a change because without new rules nor new regulations, our business
will never develop in the right way and with the ethics which has always
been the basis of our commerce. In fact I have only expressed what most of
you are thinking.
|
