AboutDavide Andrew Papa Expertise All matters pertaining to assisting Private import export INTERMEDIARIES, AGENTS and BROKERS Regarding International trade Laws and procedures,Letters of credits, as per UCP 600,Presentation, Commissions,International Rules of agency, and Incoterms 2000. All matters pertaining to shipping documents relating to the Import and export of products from one country to another.All matter for buyers and sellers of commodity products relating to the import and export industry.FTN with the introduction of UCP 600 will release the publication "The world is yours"(2004) made specifically for Intermediaries.Current inhouse tra ining manual is "Follow the Yellow Brick Road"(2008) Our advice website is www.ftnexporting.com
Experience FTN exporting founder Davide Papa has been trading for over 20 years- and has dealt with a huge variety of corporate entities including Gold and crude oil suppliers. FTN appeared in a major controversial Newspaper editorial in 1994. FTN Exporting official publication "International Trade and the Successful Intermediary"(ITSI) is about to be released world wide (December 2009) by the prestigious U.K publishing firm Gower's (U.K) and is listed on Amazon.com (Keyword: International Trade Intermediary) ITSI is ostensibly the first uniform intermediary trading doctrine of its kind, and will become the standard intermediary practice world wide in years to come. FTN exporting has created the said doctrine and supporting rules of trade defined as "URPIB" (Uniform Rules and Practice for Intermediaries and Brokers), which will (has?) become the most successful set of private intermediary rules ever created.
Publications The World is Yours and "Follow the Yellow Brick Road" www.ftnexporting.com . Author of "International Trade and the Successful Intermediary " (ITSI) 2009 excepts on http://www.gowerpub.com/default.aspx?page=637&calcTitle=1&title_id=11177&edition_id=12138
Education/Credentials Let school early. Became a master chef . Took up business management and later studied "international Trade at Stott's college Melbourne, Australia.
Question QUESTION: Dear Mr. Davide Papa
My friend has lost $90,000 through fraud. My friend nominated a vessel (that did not exist) for oil he did not have. The joker that took his money was playing both ends of the deal.
I believe you have stated in the past that it is against maritime law to pay for a vessel before the delivery of goods to the destination port. My friend does not believe me and is going to repeat the same mistake.
He is paying out more money ahead for delivery services of a vessel “again” for oil I believe, he does not have. (AGAIN)
I believe there is a possibility that my friend cannot be saved from himself but I can say I myself am getting the greatest education though You, your book “FYBR” (which I thank you for) and his very expensive mistakes. Even though my attempt to help him is probably hopeless, I would like to still try.
My Question: Where can I show him in print in any law book that (payment of vessel is at the destination port and not prior) and that your statement is fact. Thanks Craig
ANSWER:
Dear Graig
(1) There are no $90,000 oil deals Nobody is going to ship 200 to 300 MT of crude oil - Thats silly- and even if they can- what are you going to do with it-
(2)The Buyer opens a UCP600 letter of credit - It's worthless until full delivery document are issued including bill of lading- From the first day to the last day 90 days will go past before such deal is closed- If it becomes evident that the goods are fraudulent- then such fraud in itself will cancel the credit outright.
(3) I think you misquoted me- It's Freight that must be earned is based on long standing Maritime law- - That means crude oil travels under the lien of the carrier - When it arrives at unloading port- Freight is paid after the person holding title to the goods make his claim for such goods- Correct CIF Incoterms 2000
Also under UCP600 DLC rules - Bank do not pay attention to a bill of lading marked Freight "Pre-paid" - A far as bank are concerned the freight still needs to be applied as a debit against the buyer against -
So the seller on QUOTES the Freight to indicate its "Pre paid" status- whatever the freight quote given , then the seller leaves that portion of the funds in the account of the buyer , so the buyer can pay for freight when the ship arrives- The seller has Technically " Pre paid " Freight- CIF Incoterms 2000 delivery rules - etc..etc..
If you friend is hard headed then thats his problem- "A FOOL AND HIS MONEY ARE EASILY PARTED"
WE THROW ANY ANY LOI/ICPO/ASWP/BCL TYPE OF DEALS- ITS A GOOD STATING POINT YOUR FRIEND SHOULD CONSIDER
(4)In FOB deal buyer charter his own ship - I do not know of any ship that will pick up 300 my of crude oil-
and no CIF seller will ever quote 300 MT of crude oil- except localized bunkering but that's fuel oil that ship buy to run their engines-usually purchased at port of unloading and at port of loading BY THE CARRIER FOR THEIR OWN USE-
(5) Certificate or origin is a presentation document- One call to the consulate issuing such will tell you if the supplier is real or not- etc..etc. How far do you want me to go-
SGS inspection certificate ALONE ARE 100% VERIFIABLE-AND TRACKABLE AS WELL- SGS Sample certificate...Forwarders receipt...Ship's mates receipt..etc.. Is your friend say everyone are all in with the scam ..really? Thats nonsense.
Look your friend does not know what he is doing - So many scams involve people losing money on foolish mistakes an failure to apply simply checks and balances-
THAT'S WHAT SCAMSTERS LOOK FOR FOR- IF THEY TRY 1000 PEOPLE - THEY MIGHT FIND ONE OR TWO WHO CAN EASILY BE SUCKED IN-
We have never been scammed in 21 year.MANY HAVE TRIED- Even when FTN was green, I knew enough when something did not seem right- and we are given so many offer every single day - We spot a scam or fake offer in seconds-
I know a group of Americans that have lost millionS a few months ago on a stupid MTN deal- THEY DID NOT LOSE IT BECAUSE THEY ENTERED INTO A LEGITIMATE DEAL - THEY LOST IT BECAUSE THE SCAM ARTIST KNEW THEY WERE GREEN-AND THAT SUCH A GROUP REALLY DIDN'T KNOW WHAT THEY WERE DOING-
IF YOUR FRIEND DEPOSITED THE FUNDS TO OUR ACCOUNT THEN TELL THE SELLER THAT FTN IS SUPERVISING THEIR DEAL- THEY WOULD NEVER LOSE A CENT - EITHER THEY GET THE PRODUCT OR THEY GET THEIR MONEY BACK ..NO IF'S OR BUT'S because we know what we are doing and can spot a scamster from a million miles away-
One of the biggest tricks is when the seller ask for a SLC and Not DLC...It sound like your friend paid by a SLC..OR EVEN WORSE SWIFT Then that's his mistake - He should NOT be trading in matters that he does not know about-
BUT THIS IS THE BIGGEST MISTAKE OF ALL - AN INTERMEDIARY MUST NEVER PAY A CENT FOR ANYTHING- AN INTERMEDIARY USES THE FUNDS OF THE END BUYER TO BUY GOODS FORM REAL SUPPLIER-
NOW IF AN INTERMEDIARY WAS NOT INVOLVED THEN ANY END BUYER STILL HAS TO "PAY" FIRST TO ANY SUPPLIER is STILL the PREVAILING EDICT...NOW HAVING SAID THAT - AN END BUYER AND USER OF PRODUCT KNOWS EXACTLY IF THE GOODS ARE REAL LONG BEFORE A DLC IS OPENED- AND ONCE OPENED IF DELIVERY DOCUMENT DOES NOT COMPLY - THE SUPPLIER DOES NOT GET PAID-
If a person is using his own money to buy a small amount of goods, then he is not an intermediary - He is an end Buyer-and still he should seek assistance if unsure on procedure-
Tell your friend to do something else-or pay a small fee to experts to oversee and assist him in his deals next time around.
Perhaps you need to get stick and bang your friend over the head with it - He may come to his senses- especially if he is going for round two-
Regards
Davide Papa
davide_ftnexportingceo@yahoo.com.au
www.ftnexporting.com
World Wide Author: " International trade and the successful intermediary"
---------- FOLLOW-UP ----------
QUESTION: Because of my poor writing skills I did not make myself clear. The $90,000.00 my friend loss was for a down payment for services of a vessel to deliver oil he thought he had secured from a supplier. I don't know why he thought he needed to pay for this vessel as he is an intermediary. I told him the end buyer would be paying for the vessel after delivery of the oil to the destination port.
I laughed so hard after reading your suggestion on getting a stick to bang him over the head. You have been great with all the information. That is a good suggestion.
One more question: You have stated that an intermediary should not deal in a spot deal. Why? Craig.
Answer Dear Graig
Intermediary sellsw FOB - the End Buyer orders/Charters the ship. Not the intermediary buyer but End buyer- In CIF or CFR the supplier secure the ship. "Delivery" means deliver of document- meaning Once the good pass over the ships rails in port of loading the end buyer owns the goods. The supplier gets paid , the intermediary gets his commission - Ship leaves loading port and arrives at destination port - The end buyer surrenders the "delvery" title document( that the intermediary secured) to obtain "possession" of the goods
Intermediaries deal in title documents - never possession of goods-Intermediaries deal in contracts and letters of credit - A spot deal defines that the goods are ready for sale often on board ship or even ocean going- in most cases 6-10 days the goods are sold -
Intermediaries deal in FUTURE contracts of supply- By the time end buyers are secured, by the time contracts are signed , by the time a DLC is secured 40 /50 days has gone past- minimum
Inquiry/Offer Lets say 10 days ..Offer to contract both side lets say 14 days - DlC from one side transferred to the other lets says issuance 7 days acceptance 5 days , that's another 12 days -
That 36 days if you are real real smooth operator- just to get to RWA ( Ready willing and financially capable status)
Supplier will need 30 /40 days to load ship - lets say 10 days for on board inspection by SGS to be completed-before delivery documents can be fully produced and "presented" for collection-
In other words an good intermediary take at least 90 days in advance if all goes well just to secure everything needed to close a deal-
How can he buy goods already loaded or at sea...?? Exxon could buy SPOT CRUDE OIL it has a few hundred million dollars laying around in the cupboard- and intermediary does not.An intermediary has to become RWA FIRST.
Regards
Davide Papa
www.ftnexporting.com
Author: International trade and the successful intermediary-
