Businesses can avoid possible risks and legal complications in domestic and international trade following new incoterms rules, speakers on Sunday said.
They said the rules are accepted globally because of its standards, which define the responsibilities of sellers and buyers through fair sharing the costs and risks arising from the delivery of the goods.
The suggestion came at the inaugural session of a day-long workshop where a total of 125 participants from banks, law firms and companies attended.
Local chapter of the Paris-based International Chamber of Commerce (ICC) organised the workshop on the new rules at a city hotel.
Speaking as the chief guest, commerce minister Tipu Munshi said Bangladesh has been following all international trade rules for its export and imports.
Incoterms (International Commercial Terms) rules are one of them. The rules are internationally accepted standards, which define the responsibilities of sellers and buyers for the delivery of goods under sales contracts, he said.
"As Bangladesh's trade is expanding year-on-year, so practice of Incoterms 2020 will be essential," the minister said after launching of the eighth edition of Incoterms 2020 at a city hotel.
Mr Munshi was calling upon the participants to follow the international practices in dealing with global trade.
"You cannot go a long way, if you're not competitive. Incoterms is one of the systems that can make us competitive," he added.
ICC Bangladesh president Mahbubur Rahman said the global economic growth has given most businesses greater access than ever before to markets all over the world.
As a result, goods are sold today in more countries, in larger quantities, in greater variety, and at a faster pace.
But as both the volume and complexity of global trade increase, so do possibilities for misunderstandings and costly disputes when sale contracts are not adequately drafted, he said.
The Incoterms 2020 rules pay increased attention to security in the movement of goods, the need for flexibility in insurance coverage depending on the nature of goods and transport and the call by banks for an onboard bill of lading in certain financed sales under the FCA rule, Mr Rahman added.
ICCB Banking Commission chairman Muhammad A. (Rumee) Ali said L/Cs (letters of credit) are opened on the basis of pro forma invoice, which has no clause about dispute.
"So, what does happen in the event of disputes between buyers and sellers?" he said.
He advised the participants to acquaint themselves with the rules and include appropriate rules in the contract.
He also suggested keeping the provision for arbitration following the Bangladesh Arbitration Act and the rules of the Bangladesh International Arbitration Centre for settlement of disputes, if any.
Chief executive officer and managing director Mutual Trust Bank Syed Mahbubur Rahman highlighted the need for having appropriate technical know-how for safeguarding the international trade transactions.
After the first introduction of Incoterms in 1936 by the ICC, the first revision occurred in 1957 and thereafter in 1967, 1974, 1980, 1990, 2000, and 2010.
The latest version became effective globally from 01 January 2020.
The inaugural ceremony was attended by ICCB vice president Rokia A Rahman, ICCB executive board member Mir Nasir Hossain, and Uttara Group chairman Matiur Rahman, among others.
