Are you (really) following ISF Trade Rules?
Most US seed exporters trade seed "per ISF Rules". The "ISF’s trade rules bring clarity and consistency to contractual relations between buyers and sellers of seed for sowing purposes." However, there is quite a bit of misunderstanding of these rules in regards to contracts, shipping, documentation, quality, and dispute settlement. Here are some of the most common and misinterpreted ISF rules.
Article 15.3 - the ISF conversion is 1 kg = 2.205 lbs, not the metric 2.2046 or even 2.2.
Article 23.1 - The minimum documents required are "the delivery note, the invoice and a declaration of the quality". Yes, only three! Any other documents provided are at the customers request or based upon individual country requirements.
Article 25.1 - If the contract requires the seller to provide insurance it must cover "110% of the amount of the invoice in the currency specified in the contract, warehouse to warehouse, all risks, free of deductible, with indemnification payable in the Buyers' country in the currency states on the insurance certificate." Two important points to note are "warehouse to warehouse" and "free of deductible."
Article 44 - "The Seller shall ship on receipt of shipping instructions from the Buyer or, if shipping instructions are already provided for in the contract on receipt of the import permit, if relevant."
"Immediate Shipment" = Within 7 days if by rail, road, or air. Within 14 days if by ship.
"Prompt Shipment" = Within 14 days if by rail, road, or air. Within 28 days if by ship.
Article 46.1 "The Seller shall inform the Buyer by telecommunication of the means of transport and date planned (by sea: name of vessel; by rail and by road: name of transport company, by air: name of airline and flight number)." Are you always advising your buyer of their shipping schedule prior to shipment?
Article 76 "The related seed testing report should be not older than 90 days for forage and turf seed … prior to date of shipment from the warehouse of the shipper." This means your germination date should be 90 days from the date of shipment, however most buyers are more flexible allowing up to 6 months. Always ask your buyer before shipping.
Part B - Purity and Germination
No. 13: "In case of inferiority exceeding the tolerances (in Tables A and B), the new price shall be calculated according to the following formula:
X = (L x A) / G
X = new price, L = delivered quality, A = contract price, G = contracted quality
For example; you sold Tall Fescue at minimum 98% purity and 85% germination, there is an agreed minimum of 96.6% purity due to the 1.40% tolerance (note Festuca is considered chaffy seed). Germination would have a 7% tolerance with an agreed minimum of 78%. Any figures below those percentages would be considered inferior and a new price should be calculated by the formula in Part B No. 13 (above).
Read the full version of the ISF Rules and Usage for the Trade in Seeds for Sowing Purposes, visit their website.
For more information, contact AgCultured Consulting.