2. ICC INCOTERMS CIF , BANK TRANSACTION PROCEDURES TO SAFE END BUYER
2.1. End Buyer/Buying Company & Supplier sign Sales & Purchase Agreement (SPA)/Contract, with complete
coordinates. Both parties lodge the fully executed SPA/Contract with their respective banks
End Buyer sends to Supplier full details of the receiving Port Of Discharge (POD) which have to include
# full details of harbor master,
# shipping agency,
# Inspection Company etc.
End Buyer/Buying Companies must issue their detailed current/updated:
# Customer Information Sheet (CIS) or Know Your Customer (KYC), and
# Passport/license data page of Buyer.
# Company profile
The electronic sign by both parties of the SPA/Contract is legally binding and lawully enforceable.
2.2. End Buyer¡¯s bank issue via SWIFT PRE-ADVICE LETTER OF CREDIT, MT 799 to Supplier¡¯s bank, as
previously agreed on and mention it in the SPA/Contract, if any....
2.3.Supplier's Bank issues via SWIFT 2% ACTIVE PERFORMANCE BOND, MT 760 to End Bayer's Bank,
upon receipt and confirmation of End Buyers PRE-ADVICED LETTER OF CREDIT, and as previously agreed on
and mention it in the SPA/Contract, if any....
NOTA BENE:The item 2.2. and 2.3. on request of both parties as previously agreed on and mention it in the
SPA/Contract, if any....
2.4.Within five (5) banking days after lodging signed SPA/Contract with their banks, End Buyer¡¯s bank will issue
non operative Irrevocable Revolving Documentary Letter of Credit (IRDLC) with validation of one year and 45
days after, via swift to the Supplier's fiduciary¡¯s nominated bank, according to signed SPA/Contract which act as
guarantee for monthly shipment. End Buyer will send a copy of the swift of IRDLC to Supplier.
2.5.Supplier confirms receipt of Buyer¡¯s IRDLC and provide a Performance Bond of 2% that is equivalent to two
percent of the received IRDLC¡¯s amount and activate IRDLC.
NOTA BENE: IRDLC can be open without both partners are well known companies, know each other and as
previously agreed on and mention it in the SPA/Contract, if any....
2.6.Within Fifteen-Twenty (20-25) banking days, Supplier nominates vessel and pays for charter and furnish
both End Buyer & Vessel Home-office/Foreign Handler with details of LAYCAN for their records.
NOTA BENE: Fifteen-Twenty (20-25) banking days period involves Nominating the Vessel, Payment for
Charter, Securing Laycan & Clearing Vessel with Customs, sailing Vessel into Loading Terminal & Actual
Loading & Full Cargo Documentation.
2.7.Vessel is loaded and Seller Secures Full Cargo Documents and Title issued in both Supplier¡¯s and
End Buyer¡¯s name to include:
# Clean Ocean Bill of Lading, One (1) Original and Three (3) Copies.
# Seller¡¯s Commercial Invoice, One (1) Original and Three (3) Copies.
# Certificate of Origin issued by NNPC, One (1) Original and Three (3) Copies.
# Certificate of Authenticity issued by NNPC, One (1) Original and Three (3) Copies.
# Cargo Manifest, One (1) Original and Three (3) Copies.
# Certificate of Quality, One (1) Original and Three (3) Copies.
# Certificate of Quantity, One (1) Original and Three (3) Copies.
# Master¡¯s Receipt for Samples.
# Master¡¯s Receipt for Documents.
# Tanker Ullage Report.
# Tanker Time Sheet.
# Charter Party Agreement.(If the SUPPLIER IS THE SHIPPER NO NEED CPA)
# Certificate of Ownership & Warranty of Title.
# Q&Q Inspection Report Performed at Loading Port.(CALIBERATE INSPECTIONS ,LOCAL INSPECTORS
ACCREDITED BY TERMINAL)
# Other relevant documents related to the cargo.
NOTA BENE: Non-negotiable electronic copies of some Above Cargo documents will be sent to the
End Buyer and End Buyer¡¯s and Supplier¡¯s Banks. Q&Q Inspection is conducted at the End Buyer¡¯s POD and
released to both End Buyer & Supplier.
2.8.Vessel is loaded and Supplier secures all documentation and outward clearance for loaded vessel to
sail to End Buyer disport. Supplier will not raise insurance cover on cargo even as loaded vessel captain
sends Marine Notice of Readiness (NOR) to End Buyer Shipping Agency at Disport. End Buyer Shipping agent
acknowledges NOR and reply their readiness to receive the cargo on behalf of the End Buyer.
2.9.Vessel sails to End Buyer¡¯s POD. Further ETA updates to be sent to Buyer's POD at ten (10) and five (5)
days and then at forty-eight (48), twenty-four (24), and twelve (12) hours prior to arrival at POD.
Upon arrival at Buyer¡¯s POD, vessel announces arrival to Port Authority/Navy. Buyer¡¯s shipping
agency clears vessel into the POD Anchorage.
NOTA BENE: The loaded vessel will only anchor in the international waters of the POD country pending
Clearance from Buyer shipping agent. Any expenses; port charges, levies, security, tugging etc. that
might arise as a result of vessel coming into the POD country harbor/port/terminal/storage or waters
will be borne by the Buyer. All clearing processes will be carried out by the Buyer¡¯s Shipping Agent. If
after seventy-two (72) hours upon vessel arrival and there is congestion at the port which thus
causes delay, Buyer shall bear cost of demurrage.
2.10.Vessel is cleared into Buyer¡¯s Discharge Port, and Vessel Master issues a Marine Authority To
Board (ATB) to Buyer¡¯s nominated Inspectors as per Buyer¡¯s format. Q&Q analysis is conducted at
Buyer's expense. Inspection Agency must be either SGS, INTERTEK, SAYBOLT, CIQ or equivalent and
must be acceptable to Supplier. The final Q&Q report is sent to both End Buyer and Supplier respectively.
2.11.Upon receipt of the Inspector¡¯s Q&Q report by both End Buyer & Supplier. Supplier issues the Final
Commercial Invoice based on out-turn barrels inspected.
NOTA BENE: The Calculated Price for The Final Commercial Invoice Shall Be Based on the Q&Q Report at
and On The THREE-DAY AVERAGE OF DATED (DTD) BRENT Day of Closing. As Stated in The Daily
Published PLATT¡¯S CRUDE OIL MARKET-WIRE REPORT/EUROPEAN MARKETSCAN.
2.12.End Buyer¡¯s Bank makes Full Payment in US$ to Supplier¡¯s Nominated Bank Account and commissions to
agents/facilitators account via MT 103 TT within three (3) banking days of receiving the
Final Commercial Invoice. End Buyer¡¯s Bank will advise Supplier¡¯s Bank by SWIFT or tested telex quoting the
value date of the transfer, the amount, the invoice number, and the clearing bank, If any.... Such advice
is to be sent in due time so as to enable Supplier¡¯s Bank to credit Supplier with value on due date.
NOTA BENE: If Full Payment is NOT received within a maximum of five (5) banking days of End Buyer receiving
Final Commercial Invoice, Full Cargo Document and Title on Cargo, Supplier¡¯s Bank has the right to call
the End Buyer¡¯s Irrevocable Revolving Documentary Letter of Credit (IRDLC) for settlement of total value of
cargo in accordance to item 2.7. outlined under the clause 2.10 herein.
2.13.Supplier¡¯s Bank and intermediaries agents banks confirm Payment and Supplier sends Original Copies of
all Shipping Documents, Title and Discharge Certificate to End Buyer via 1st class Courier.
2.14. Suppler instructs Vessel Master of Loaded Vessel to Discharge Cargo into End Buyer¡¯s Storage Facility
INTERESTED BUYERS NEED TO APPLY WITH LOI/RFQ/ICPO TO START THE PROCESS.