Scenario
A. Company A produces and sells edible oil from Country A.
B. Company B trades edible oil. You are working for Company B in the operations department.
C. Company C imports edible oil into Country C.
D. Company D is domiciled in Country C and buys edible oil to refined into cooking oil.
E. Company E is a ship-owner with tonnages focused on edible oil trade.
Sequence of Events
– Company B bought 15,500 metric tons of edible oil from Company A on
FOB terms at $150 per metric ton and sold the parcel of edible oil to Company C on CFR terms at $200 per metric ton.
– Company B entered into a time-charter trip contract with Company E at
$12,000 per day pro rata for Vessel 1.
– Company C sold 10,500 metric tons to various Buyers in Country B and
3,500 metric tons to Buyers in Country C.
– Company C sold 1,500 metric tons to Company D. Company C requested
Company B to re-issue Bills of Lading with Company D as Consignee.
Company E re-issued the Bills of Lading against a Letter of Indemnity.
– Due to severe port congestion at Country B, Vessel 1 was delayed for one
month at Country B.
– Company D arrested Vessel 1 citing economic damages arising from
currency fluctuation losses due to Vessel 1 breaching its contractual
obligations to pursue the voyage with utmost dispatch. Vessel 1 was finally
released 10 days after the completion of discharge.
