- Russian Federation
- Fourth circuit Arbitrazh Court of Appeal
LONG-TERM CONTRACTS - SUPPLY CONTRACT - BETWEEN A RUSSIAN COMPANY AND A CHINESE COMPANY - UNIDROIT PRINCIPLES APPLIED AS MEANS FOR INTERPRETING DOMESTIC LAW (RUSSIAN LAW)
UNIDROIT PRINCIPLES APPLIED TOGETHER WITH ARTICLE 58(1) CISG
FREEDOM TO ENTER INTO AND DETERMINE THE CONTENT OF THE CONTRACT - REFERENCE TO ARTICLE 1.1. OF THE UNIDROIT PRINCIPLES
Claimant, a Russian food limited liability company “Rusprodimport” filed a lawsuit with the commercial court of Zabaikalskiy krai against Respondent, the customs office of Chita. Claimant requested the court to render decisions on value adjustment of goods unlawful. The court held that the decisions rendered by Respondent did not comply with the provisions of value adjustment of the Customs Code of the Customs Union and satisfied the claims.
Respondent appealed the decision with the Fourth commercial appeal court. It argued that the price of goods was not fixed. It referred to the Agreements on the application of Article 7 of the General Agreement on Tariffs and Trade 1994, according to which “The value for customs purposes of imported merchandise should be based on the actual value of the imported merchandise”. Moreover, Respondent claimed that additional agreement N 8 fixed the price on goods (shelled peanut). Goods delivery from China to Russia was performed in accordance with DAF terms and included price of container, packing and labeling. While doing customs clearance, customs applicant presented all necessary documents. In the reply to the decisions of a redundancy check performance customs applicant mentioned that the Company does not have all documents since Seller did not provide it with the Buyer. Thus, Seller did not pass to Buyer the price list and business offers. Consequently, the transaction value was confirmed with the contract solely.
The appellate court left the decision of the first instance court unchanged and appellate claim unsatisfied. In deciding this case the court applied the following legal instruments: the General Agreement on Tariffs and Trade 1994, namely 2a of Article 7; the Customs Code of the Customs Union; the Agreement between the Republic of Belorussia, the Government of the Republic of Kazakhstan and the Government of the Russian Federation; Russian national law.
The court also referred to Art. 1.1 of The UNIDROIT Principles of International Commercial Contracts 2010, stating that “The parties are free to enter into a contract and to determine its content” and to Art. 58 (1) CISG.