Saleform 2012 Explanatory Notes

  SALEFORM  2012  
Explanatory  notes  
     
Introduction   The  revision  of  any  standard  agreement  as  internationally  recognised  and  widely  used  as  SALEFORM  93  is  not  a   matter  lightly  undertaken.  The  decision  to  revise  SALEFORM  93   was  based  on  feedback  from  the  global   ship   sale   and   purchase   sector   who   were   asked   whether   an   update  was   needed   and,   if   so,   to   what   extent   the   agreement  should  be  revised.       The  message  from  the  feedback  was  very  clear    while  the  present  SALEFORM  largely  met  the  current  needs  of   the  industry,  it  would  certainly  benefit  from  a   modest   update  to  reflect  commonly  applied  amendments  and   rider  clauses.       Of  equal  importance  to those  consulted  was  that  the  general  principles  and  structure  of  SALEFORM  should  be   Association  (NSA),  was  how  to  make  this  well-­‐used  international  sale  and  purchase  contract  even  better  while   maintaining  all  the  key  elements  that  the  industry  has  come  to  rely  on.     Over   a   period   of   11   months   the   NSA/BIMCO   drafting   team   carried  out   a   thorough   review   of   SALEFORM   in   consultation  with  the  industry.  On  10  November  2011,  the  Documentary  Committee  approved  the  new  edition,   called  SALEFORM  2012.       The  revision  process  identified  the  key  clauses  most  commonly  amended  in  SALEFORM  and  pinpointed  areas   where  ambiguity  in  the   93  edition  had,  on  occasion,  led  to misunderstanding  and  uncertainty.  The  new  edition   brings  greater  clarity  to  the  agreement  as  well  as  amended  wording  that  reflects  current  commercial  practice.     The   NSA   and   BIMCO   would   like   to   thank   the   following   members   of   the   SALEFORM   Sub-­‐committee   for   their   hard  work  and  commitment  in  revising  SALEFORM:     NSA   Petter  Andrup,  R  S Platou  ASA  (Chairman)   Peter  Graff,  Inge  Steensland  AS   Erik  Grepne,  Joachim  Grieg  &  Co.  AS   Erik  Ofstad,  R  S  Platou  ASA   Lars  Chr.  Skarsgård,  Fearnleys  AS   Carl  F.  Wennersteen,  Oslo  Shipbrokers  AS   Ole  H.  Zachariassen,  Lorentzen  &  Stemoco  AS   Henrik  Aadnesen,  Nordisk  Skibsrederforening     BIMCO   Francis  Sarre,  CMB,  (Chairman)   Christoph  Bruhn, Bruhn  Shipbrokers   Georg  Scheel,  Nordisk  Skibsrederforening   Matt  Hannaford,  Clyde  &  Co   Harry  Fafalios,  Fafalios  Shipping   Alan  Mackinnon,  UK  P&I  Club     The  following  Clause  by  Clause  commentary  highlights  the  amendments  that  have  been  introduced  in  the  2012   edition  of  SALEFORM:      


 

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Definitions   A  number  of  additional definitions  are  included  to  aid  clarity.     1.  Purchase  Price   The   Parties   are   now   required   to   state   the   currency   and   amount   of   the   Purchase   Price   both   in   words   and   figures.     2.  Deposit   In   SALEFORM   93   the   size   of   the   Deposit   was   predefined   at   10%.   Current   industry   practice   suggests   that   a   different   percentage   may  often   be   agreed.   The   new   edition   has   space   for   the   Parties   to   fill   in   an   agreed   percentage  of  the  Deposit,  while  providing  a  default  percentage  of  10%  in  case  the  space  is  left  blank.       In  recent   years  opening  a   bank   account   has  become  increasingly   more   difficult  and  time  consuming  in   some   jurisdictions.   Commonly,  entities   other   than   banks   are   used   to   hold   funds   in   escrow.   To   reflect   these   developments  the  term  Deposit  Holder  has  been  introduced  to  identify  the  party  holding  the  agreed  Deposit.   This  can  be  a  bank,  law  firm,  ship  broker  or  any  other  institution  the  Parties  may  agree  on.  The  account  must   be  capable  of  earning...