International Sale Agreement, Incoterms 2010, Rules of Jurisdiction

Incoterms 2010

In International Contracts, the use of Incoterms 2010, issued by ICC, International Chamber of Commerce, is daily. Businesses, however, use them inappropriately, sometimes failing to clearly state what has been agreed at the negotiation stage, specifying delivery terms, yields, applicable law and resolution of controversies, with reference to the place of judgment, if any, to the language in which the dispute will be discussed, and whether it will be decided by the Ordinary Judge or an Arbitration.
Incoterms 2010 is designed to clearly determine who should bear the costs and responsibilities for each part of the carriage, customs costs, departure and destination, insurance costs, and must be expressly recalled in the contract, indicating the source to avoid ambiguity and complications, for example, to the hypothesis of an American importer who in good faith could interpret the term FOB so different from that of the seller as it would consider the FOB destination of destiny agreed in the importing country on the basis of the ” Revised American Foreign Trade Definitions “of the US Chamber of Commerce, and why, in the event of a dispute, the Judge or the Referee are bound to their application without being able to resort to the custom and local uses.
It follows that it is important to apply correctly both in the seller’s unilateral documents and in the drafting of the contract, because in relation to each Incoterms it is decisive to determine when the delivery takes place.
The place and moment of delivery with relative risk transfer from one subject to another is defined as critical point.
Contractual clauses and jurisdiction
If the Incoterms are intended to regulate some of the bonds related to the delivery of the goods and the consequent passing of the risk of damaging the goods from the seller to the buyer, clear and explicit arrangements will contractually determine the delivery location and avoid applying the cd criterion economic “which only occurs if the parties have not clearly indicated the place of delivery.”
The Court of Cassation, Unite Civil Sections, intervened in the controversial question concerning the determination of the competent court in international trade disputes, by order no. 24279/14 reiterated a well-established case-law stating that the finding of the jurisdiction of the Italian court must be clear and explicit, that is, must clearly result from the contract. In that case, the Court decided on a preliminary ruling on jurisdiction to find the forum competent to hear a dispute brought against a court in Turin by an Italian company against a foreign company which in the opposition to the injunction had previously objected to the defective jurisdiction of the Italian court, relying on EC Regulation 44/2001, alleging that the goods were effectively handed over to their home office and that was the result of the CMR documents where that office was designated as the place of delivery at which the goods were received. In the present case, it was clear that there was no clear agreement on the determination of the jurisdiction of the Italian court, whereas in order to be able to prevail over the title of jurisdiction referred to in Article 5 of the Regulation, that is to say, on the criterion of the place of performance of the delivery , the derogation “must be clear and explicit, ie it must clearly result from the contract.”
In short, review the Merit Law:
Court of Piacenza, judgment of 14 May 2013, requires the unequivocal will of both parties to determine the jurisdiction, since it is not worth the inclusion of Incoterms in the order confirmation;
Milan Tribunal, judgment 21.1.13, n.73, decides in favor of the prevalence of the economic criterion which inevitably leads to the final destination, even though in the trial the Ex Works contract was proven;
Court of Padua, May 03, 2012, regarding the Inputs CTP, that clause should have regulated the division of transport costs, but not the contractual bargain, having such rules, in abstract terms, in order to determine the jurisdiction but having in concrete terms, be the subject of agreement between the parties.
Conclusions
The judgments examined have in most cases revealed an inadequate use of Incoterms in the seller’s unilateral documents (order confirmations, invoices) and the contractual clauses defined by Judges with insufficient formulations, which , nor do they generally express a clear and explicit agreement on specific points that are peacefully accepted, but which, at times, denote ambiguous arrangements with the presence, as it happened, of two contradictory data.