1. International Trade &Transaction 3th Lecture

2. Intermediaries  In contracting of sale: export-import department of the company, sales representative; agent, distributor (or wholesaler), export-management company, trading-house;  In transportation: forwarding agents, terminal operators; logistic centers;  In insurance: independent brokers; dependent underwriters;  In finance: factoring companies; nominated banks;

3. Steps for market entry  Indirect export;  Direct export;  Licensing;  Franchising;  Foundation of Joint venture;  Buy-up domestic companies, and markets;  FDI-Subsidiaries;

4. Steps for market-entry 1. On the behalf of / for the account /at the risks of his principal:  Sales representative → not subject to VAT tax law; Not entitled to conclude a concrete deal ; fixed salaried; contract of employment or agency;  Agent → professional; commission fee on FOB base; contract of agency;  Types: salaried (retainer;) stockiest; consignment stokiest; after-sale services; del credere;

5. Steps for market entry 2. On the behalf of / for the account of/ at the risks of his own;  Distributor → contract of sale and contract of agency ; mark-up; full liability for the products towards customers; Liable jointly and severally towards consumers; takes on financial (liquidity), performance risks as well; Wholesaler function;  Types of distributors: after-sale service, stockiest;  Re-exporter buys and resells in its own name, not disclosing the origin of goods; use of arbitrage;  Types: covered vs. not-covered; transitor;

6. Steps for market entry 3. On the behalf of his own, but for the account of and at the risk of his principal:  Export-management company → contract of sale with the foreign partner+ contract of agency with the domestic partner ; Limit price; Commission fee +Premium;  Takes on all potential liability towards foreign partner because it acts as if it were the original supplier/or final purchaser;

7. Steps for market entry 4. Trading House: all functions, but especially Financing; Aggregating the demand and the supply → having the large-scale position; All linked operations: warehousing, transportation, logistic services; Clerical work; Sogo shosha; London specialized in;