PUR-CON-005
Title: GENERAL CONDITIONS OF CONTRACT / Revision: 6
Page 1 of 20
Implementation Date: 1 September 2011
GENERAL CONDITIONS OF CONTRACT AND PURCHASING
Revised on 25/07/2011
C1.DEFINITIONS
Unless inconsistent with or otherwise expressly indicated by the context:
C1.1.“Columbus” means Columbus Stainless (Pty) Ltd, a private company with limited liability duly incorporated in terms of the laws of the Republic of South Africa.
C1.2.“Vendor” means the person, company or legal entity with whom this Contract is entered into and who has accepted such Contract.
C1.3.“Acceptance” means the acceptance of the Service and/or Goods by Columbus, as indicated by signing off the relevant proof of delivery / invoice document.
C1.4.“Contract” means the agreement entered into by Columbus with the Vendor, including the Memorandum of Agreement, the Special Conditions of Contract, the General Conditions of Contract, Scope of Work, Price Schedules and all attachments together with any subsequent written amendments thereto issued by Columbus.
C1.5.“Order” means Columbus’ written Purchase Order, together with any subsequent written amendments thereto issued by Columbus.
C1.6.“Conditions” means the Conditions contained in the Memorandum of Agreement, Special Conditions of Contract, General Conditions of Contract, Scope of Work, Price Schedules and all attachments together with any subsequent written amendments thereto issued by Columbus.
C1.7.“Goods” means all Goods covered by this Contract and/or each specific Order, whether raw materials, processed materials, or fabricated products and/or the work to be done in terms of the Contract and each specific Order, in respect of such Goods.
C1.8.“Services” means the rendering of all Services covered by the Contract and each specific Order.
C2.ACCEPTANCE OF CONTRACT
The Vendor, by signing the Contract, signifies acceptance of the Contract and these Conditions. If the Vendor accepts an Order or commences work under the Contract, without signing the Contract, the Vendor shall be deemed to have accepted and shall be bound by the Contract and these Conditions.
C3.CONTRACT PRICE BASIS
C3.1.All prices are inclusive of all duties, charges, license and other fees but exclusive of VAT.
C3.2.The prices shown in the Contract cannot be varied except by a duly executed amendment. All applications for price adjustments in the Goods/Services forming the subject matter of the Contract are entirely at the discretion of Columbus and are to be received by the Purchasing Manager: Contracts not later than 30 (thirty) days prior to the intended date of implementation. Any requested adjustment to the Contract Price shall be supported by relevant documentary evidence thereof, and shall be subject to negotiation and mutual agreement prior to implementation.
C3.3.All Orders placed against this Contract shall be delivered and invoiced in accordance with the Contract price as at the date of Order placement, irrespective of the expected delivery date of the Goods/rendering of the Service.
C3.4.Payment is subject to any deductions and retentions authorised in terms of the Contract and the performance by the Vendor of all of its obligations in strict accordance with the terms of the Contract. Payment will be made in the currency specified in the Contract.
C3.5.Payment made by Columbus will not affect the rights of Columbus hereunder or be interpreted as approval or acceptance of the Goods and/or Service.
C3.6.The Vendor will, if so required, furnish Columbus with acceptable security in such form as Columbus may require, for the timely and due performance of all of its obligations in terms of the Contract.
C4.PRICE MAINTENANCE
Should Columbus at any time receive a bona fide written offer from a third party for the supply of the Goods in similar volumes, or for the rendering of a similar Service, on the terms and conditions set out in this Contract but at prices lower than those contained herein, Columbus shall be entitled to request the Vendor to match the lower price within seven (7) days of the date of written notification from Columbus. Failing timeous acceptance by the Vendor, Columbus shall be entitled to purchase the Goods or obtain the Service from the third party for so long as such prices remain lower than those contained in this Contract.
C5.PAYMENT AND INVOICING
C5.1.Payment shall be made, without prejudice to the rights of Columbus, under any of the terms and conditions of the Contract provided that:
C5.1.1.A tax invoice is received by Columbus Stainless (Pty) Ltd, Document Centre, Attention: Creditors Control, Private Bag 251844, Middelburg, 1050, on or before the 20th day of the month of the same month of deliveries and/or services rendered. All invoices must be Tax Invoices as required by the Value-Added Tax Act 89 of 1991 as amended. Tax invoices, statements and all correspondence are to reflect the Columbus Order number and / or contract number, VAT no 4640196368, a short description of delivery and / or service, and the Supplier’s VAT no.
C5.1.2.Columbus receives a statement of account covering the deliveries and/or services rendered mentioned above, on or before the 7th day of the month following the deliveries or services rendered.
C5.2.Columbus’ standard payment terms are:
C5.2.1.Payment at the end of the month following the month of delivery/service, less 2.5% settlement discount, or
C5.2.2.Payment at the end of the second month following the month of delivery/service, net.
C5.3.The Vendor shall indicate in its quotation its preferred terms of payment, i.e. C5.2.1 or C5.2.2 above.
C5.4.All goods delivered and/or services rendered up to the 20th day of the month shall be the delivery/service month.
C5.5.All goods delivered and/or services rendered after the 20th day of the month shall be considered as part of the following delivery/service month.
C5.6.In the event that either a tax invoice or a statement of account is received after the date specified, payment may be deferred until the accounts for the next payment period falls due.
C6.SET OFF
All liquidated or unliquidated costs, monies or expenses for which the Vendor is liable to Columbus may be deducted from and set off against monies due or becoming due to the Vendor.
C7.TIME OF ESSENCE
C7.1.The time specified in the Contract for rendering the Services and/or delivering the Goods is of the essence and of the utmost importance. The Contract is awarded on the definite understanding that delivery will be effected not later than the date or dates specified in theContract. Partial delivery is not permitted without Columbus’ written approval. The Vendor shall furnish such schedules of delivery as Columbus may reasonably require. The Vendor shall give notice to Columbus immediately and confirm in writing if such schedules are, or are likely to be delayed or varied, including the status of any sub-contracts.
C7.2.If the Vendor’s performance is behind schedule, Columbus shall have the right by notice in writing in addition to its other remedies, to require that the Vendor take appropriate corrective action. Failure of the Vendor to take such corrective action within seven (7) days from the receipt of such notice, shall constitute a material breach of the Contract.
C8.DELIVERY
C8.1.Unless otherwise specified in the Contract, delivery terms shall have the meanings assigned to them in the International Rules for the Interpretation of Trade Terms 2010 Edition (Inco terms) published by the International Chamber of Commerce.
C8.2.Delivery of Goods by the Vendor shall be effected following satisfactory inspection by Columbus or its representative at such place or places and at such time or times and in such manner as specified in the Contract. Delivery shall be verified and recorded by such appropriate substantiating documentation as Columbus may require.
C8.3.The Vendor shall give Columbus written notice not less than seven (7) days prior to availability of the Goods for dispatch and shall not dispatch unless consent to do so is given by Columbus. Should Columbus issue instructions to delay the delivery of such Goods beyond the delivery date stipulated in the Contract, the Vendor shall make all necessary arrangements for storage, protection and insurance and shall be responsible until Columbus has taken delivery of the Goods, provided that Columbus shall bear the reasonable cost of such storage, protection and insurance. Should the Vendor dispatch the Goods without Columbus’ approval, the Vendor shall be liable for all expenses incurred up to the date on which Columbus would otherwise have accepted the Goods. Columbus shall nevertheless have the right to reject acceptance thereof in the meantime.
C8.4.The Vendor shall advise Columbus on the day of dispatch that dispatch has taken place and such advice shall clearly identify the Goods dispatched. All Goods must be delivered at the delivery point stipulated in the Contract, or as alternatively indicated by Columbus to the Vendor in writing. If Goods are incorrectly delivered, the Vendor will be held responsible for any additional expense incurred in delivering them to their correct destination.
C8.5.Columbus shall have the right, from time to time during the execution of the Contract, by notice in writing, to direct the Vendor to add to or to omit, or otherwise vary, the delivery schedules. Any variations that this may cause in price or fulfilment of obligations by the Vendor in terms of this Contract must be immediately communicated to Columbus. Columbus shall then confirm its instructions in writing and modify the said obligations to such an extent as may be justified.
C8.6.Until Columbus so confirms its instructions, they shall be deemed not to have been given and any work already carried out or Goods delivered in connection therewith, shall be at the Vendor’s own cost and expense.
C9.SUBCONTRACTING
C9.1.The Vendor shall declare his intention to sub-contract any part of the Contract and shall clearly indicate what part of the Contract will be sub-contracted and to which suggested sub-contractor.
C9.2.The Vendor shall not sub-contract the whole or any part of the Contract without the prior written consent of Columbus,which consent shall not be unreasonably withheld. Such consent, if given, shall not relieve the Vendor from any liability or obligation under the Contract and he shall be responsible for the acts and defaults of any sub-contractor, his agents, servants or workmen as fully as if they were the acts and defaults of the Vendor.
C9.3.The Vendor shall provide a list of all sub-contractors to Columbus, for Columbus’ approval.
C9.4.Sub-contractors as listed in the Contract are the only approved and mutually agreed sub-contractors that may be utilised for the Contract.
C9.5.Where Columbus has consented to the placing of sub-contracts, copies of each sub-contract shall be sent by the Vendor to Columbus immediately once they are issued. All sub-contracts shall contain similar terms and conditions to these Conditions so far as applicable.
C9.6.Columbus reserves the right to cancel the Contract, without any payment whatsoever, in the event of the Vendor’s breach of this clause.
C10.EXPEDITING TESTING
C10.1.Columbus shall be given access at all reasonable time to the Vendor’s works or offices or those of any sub-contractors to view or discuss work in progress.
C10.2.Columbus, its authorised representatives and any Columbus appointed independent inspection authority, shall have the right:
C10.2.1.to inspect and test the Goods at all reasonable times during manufacture and prior to delivery, at the Vendor’s works and the works of sub-contractors as Columbus may deem necessary or desirable;
C10.2.2.to audit the Vendor’s and its sub-contractors’ quality assurance systems; and
C10.2.3.to reject Goods or any portion thereof which are defective or inferior in quality of material, design or workmanship or otherwise not in conformity with the terms and conditions of the Contract to the satisfaction of Columbus. The Vendor’s sub-contracts shall provide accordingly.
C10.3.Any portion of the Goods so rejected shall be the subject of immediate action by the Vendor to replace, repair or modify and submit for inspection and/or testing. Any work to be so performed by the Vendor shall not entitle the Vendor to an increase in its price(s) or to an extension of the delivery date for the Goods.
C10.4.The Vendor shall provide, without charge, all necessary tools, instruments, apparatus, equipment, services, labour, materials, operating and instruction manuals and other facilities for carrying-out such expediting, inspecting and testing of the Goods as Columbus requires, including reasonable use of telephone, fax, e-mail and office facilities.
C10.5.Unless otherwise specified, the Vendor shall advise Columbus at least seven (7) days in advance of the date upon which any part of the Goods will be ready for inspection or testing. Columbus reserves the right to charge the Vendor any reasonable costs incurred by Columbus as a result of abortive visits to the premises of the Vendor or of its sub-contractors, should the Goods and associated documentation not be ready or available for inspection or testing.
C10.6.Such an inspection or test is solely for the benefit of Columbus. The issue by Columbus of an Inspection Release Certificate or any other document signifying acceptance of the Goods in respect of quality, quantity, workmanship and/or completeness of the Contract, shall not relieve the Vendor of its obligations and/or liabilities in terms of the Contract should it be found at a later date that the Goods are not in accordance with the Contract, fair wear and tear excepted. Goods will be accepted at the place of delivery only as regards to the number and condition of packages and, notwithstanding any receipt that may have been given, the Goods shall remain liable to rejection if not in accordance with the Contract. Rejected Goods will be held at the risk and expense of the Vendor, who, before such Goods are released, shall refund to Columbus as much of the purchase price as will already have been paid and all reasonable expenses incurred by Columbus in respect of such Goods.
C10.7.Columbus shall have the right to waive inspection during manufacture, prior to delivery, without prejudice to Columbus’ right to reject the Goods or any portion thereof after delivery. Goods rejected as not conforming to the requirements of the Contract, shall be immediately replaced at the Vendor’s risk and expense. Columbus’ failure to detect non-conformities in the Goods or any portion thereof, shall not deprive Columbus of any of its rights or remedies against the Vendor hereunder or otherwise.
C10.8.Columbus shall have the right to call upon the Vendor at any time for evidence of origin of raw materials and parts.
C11.QUALITY ASSURANCE
C11.1.To ensure that product and/or service quality characteristics meet Columbus’ requirements, the Vendor shall supply to Columbus supporting documentation such as Certificates of Conformance, Quality Plans or Statistical Process Control Charts, as appropriate, and/or as stipulated in the Contract.
C11.2.Columbus reserves the right to inspect the Vendor’s business premises on a regular basis to conduct Quality Assurance Audits.
C12.PACKING
C12.1.The Vendor shall properly and carefully pack and prepare the Goods for carriage and forwarding. The Vendor shall indemnify Columbus against all issues or claims arising out of or in connection with any damage caused by or resulting from defective packing of Goods. Unless stated otherwise in the Contract, the Goods shall be carried and transported to the place of delivery at the risk and expense of the Vendor.
C12.2.The Vendor shall identify each and every package, bundle, bag, carton, container or article by means of either suitable labels securely attached thereto or indelibly printed thereon, with the following information:
C12.2.1.detailed description of Goods,
C12.2.2.name of Supplier,
C12.2.3.Contract number and Order number,
C12.2.4.Columbus’ stock code number, where specified in the Contract,
C12.2.5.if purchased by mass, net mass of the contents.
C12.3.In the absence of any agreement to the contrary, packages, packing materials and packing charges, shall be deemed to be included in the purchase price and packages and materials shall remain the property of Columbus. Where the price quoted is “ex works”, the Vendor shall include in its price and be responsible for packing the Goods in such a manner as to ensure freedom from loss or injury whilst in transport by means stated in the Contract. Columbus shall be entitled to recover from the Vendor loss or damage, which Columbus has suffered arising from the failure to comply with this clause.
C12.4.In the event thatColumbusexercises the option to return packages, Columbus will return such packages at the Vendor’s costs.
C13.MINIMUM STOCKHOLDING
The Vendor shall at all times, maintain reasonable stock levels of the Goods to be supplied to Columbus in terms of the Contract.
C14.REDUNDANCY
Columbus does not accept that any Goods shall become redundant. The Vendor undertakes that as long as the Goods are in Columbus’ possession, when so requested, the Vendor shall maintain the Goods at a reasonable cost.
C15.FREE ISSUE MATERIALS
Where Columbus for the purposes of the Contract, issues materials “free of charge” to the Vendor, such materials shall be and remain the property of Columbus and shall be clearly marked as such. The Vendor shall maintain all such materials in good order and condition subject, in the case of tooling, patterns and the like, to fair wear and tear and shall use such materials solely in connection with the Contract. Any surplus materials shall be disposed of at Columbus’ discretion. Waste of such materials arising from bad workmanship or negligence of the Vendor, shall be made good at the Vendor’s expense.
C16.DRAWINGS
C16.1.The Vendor shall deposit in a place of safekeeping and storage in the Republic of South Africa, an updated copy of all detailed manufacturing drawings relating to the Goods. The acceptance of the Goods is conditional upon such deposit having been made. The storage costs for the continuing deposit and storage of such drawings shall be for the account of the Vendor.
C16.2.Columbus shall be allowed access to the appropriate drawings in the event the associated equipment, spare parts, etc. are prevented from being exported to the Republic of South Africa, for the purpose of manufacture of such equipment and spare parts, etc.