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CISG CASE PRESENTATION

China 31 July 1997 CIETAC Arbitration proceeding (Axle sleeves case) [translation available]
[Cite as: http://cisgw3.law.pace.edu/cases/970731c1.html]

Primary source(s) of information for case presentation: Case text

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Case identification

DATE OF DECISION: 19970731 (31 July 1997)

JURISDICTION: Arbitration ; China

TRIBUNAL: China International Economic & Trade Arbitration Commission [CIETAC] (PRC)

JUDGE(S): Unavailable

DATABASE ASSIGNED DOCKET NUMBER: CISG/1997/24

CASE NAME: Unavailable

CASE HISTORY: Unavailable

SELLER'S COUNTRY: People's Republic of China (claimant)

BUYER'S COUNTRY: United States (respondent)

GOODS INVOLVED: Axle sleeves


Classification of issues present

APPLICATION OF CISG: Yes [Article 1(1)(a)]

APPLICABLE CISG PROVISIONS AND ISSUES

Key CISG provisions at issue: Articles 9 ; 38 ; 39 ; 78

Classification of issues using UNCITRAL classification code numbers:

9A ; 9C [International usages; Practices established by the parties];

38A [Buyer's obligation to examine goods: time for examining goods];

39A2 [Requirement to notify seller of lack of conformity of goods: buyer must notify seller within reasonable time];

78B [Rate of interest]

Descriptors: Usages and practices ; Examination of goods ; Lack of conformity notice, timeliness ; Interest

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Editorial remarks

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Citations to case abstracts, texts, and commentaries

CITATIONS TO ABSTRACTS OF DECISION

(a) UNCITRAL abstract: Unavailable

(b) Other abstracts

Unavailable

CITATIONS TO TEXT OF DECISION

Original language (Chinese): Zhong Guo Guo Ji Jing Ji Mao Yi Zhong Cai Wei Yuan Hui Cai Jue Shu Hui Bian [Compilation of CIETAC Arbitration Awards] (May 2004) 1997 vol., pp. 2257-2263

Translation (English): Text presented below

CITATIONS TO COMMENTS ON DECISION

English: Dong WU, CIETAC's Practice on the CISG, at nn.13, 43, 80, Nordic Journal of Commercial Law (2/2005)

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Case text (English translation)

Queen Mary Case Translation Programme

China International Economic & Trade Arbitration Commission
CIETAC (PRC) Arbitration Award

Axle sleeves case (31 July 1997)

Translation [*] by Meihua Xu [**]

Edited by John W. Zhu [***]

The China's International Trade and Economic Arbitration Commission (hereafter, "the Arbitration Commission") accepted the case, according to the arbitration clause in

   -    Sales Confirmation Nos. 94CQJ3-1838A1, 94CQJ3-1838A2 signed by Claimant [Seller] Chongqing XX Trade Company and Respondent [Buyer] America XX Company on 12 September 1994;
 
   -    Sales Confirmation No. 95CQJ3-1838001, signed by [Seller] and [Buyer] on 15 February 1995;
 
   -    Sales Confirmation No. 95CQJ3-183804, signed by [Seller] and [Buyer] on 5 May 1995;
 
   -    Sales Confirmation No. 95CQJ3-183804A, signed by [Seller] and [Buyer] on 8 June 1995;
 
   -    Sales Confirmation No. 95CQJ3-183804B, signed by [Seller] and [Buyer] on 20 July 1995;
 
   -    Sales Confirmation No. 95CQJ3-183804C, signed by [Seller] and [Buyer] on 28 September 1995; and
 
   -    The written arbitration application submitted by [Seller] on 10 October 1996.

On 15 November 1996, [Buyer] submitted an application for a counterclaim. The Arbitration Commission agreed to hear the arbitration claim and its counterclaim, and gave notice to [Seller] and [Buyer].

The [Seller] appointed Mr. A as arbitrator, and [Buyer] appointed Mr. D as Arbitrator. With the concurrence of both parties and in accordance with Article 24 of the Arbitration Rules, the Director of the Arbitration Commission appointed Mr. P as the Presiding Arbitrator. The three arbitrators formed the Arbitration Tribunal to hear the case on 12 December 1996.

The Tribunal went through the arbitration application and attached evidence submitted by the [Seller], and the representation opinion and its attachment submitted by the representative of the [Buyer]. On 23 January 1997, the Arbitration Tribunal held a court session in Shenzhen. Both [Seller] and [Buyer] sent representatives to present at the session; they made oral statements, answered the Arbitration Tribunal's questions, and presented oral arguments. After the court session, both parties submitted supplementary materials.

Based on the written documents submitted by the parties and the court session, the Arbitral Tribunal has concluded the case. The following are the facts, the Tribunal's opinion and award.

I. POSITION OF THE PARTIES

[Seller]'s position

Between 1994 and 1995, [Buyer] and [Seller] entered into Contracts No. 94CQJ3-1838A1 and No. 94CQJ3-1838A2 under which five Sub-contracts No. 95CQJ3-183801, No. 95CQJ3-183804, No. 95CQJ3-183804A, No. 95CQJ3-183804B and No. 95CQJ3-183804C were also signed subsequently.

Following the contracts, the [Seller] made axle sleeves as instructed by the blueprint provided by the [Buyer]. The [Seller] also made seventeen deliveries of the goods between 23 November 1994 and 18 October 1995. However, the [Buyer] only paid for the first eight deliveries in the amount of US $159,668.57, and did not make the payment for the other nine deliveries, which was US $126,709.57. After being urged by the [Seller], on 10 November 1995, the [Buyer] sent a fax to the [Seller] alleging that there were quality problems with the goods. The [Buyer] refused to pay asserting that the axle sleeves could not sustain 3,000 pounds of weight, which is a serious quality problem. The [Seller] then sent the goods to Chengdu XX University to conduct a pressure testing. The result showed that the axle sleeves could sustain 10,360 pounds of weight. However, the [Buyer] still refused to pay.

In addition, the contract provides that the [Buyer] can only claim lack of conformity of the goods within thirty days after the goods have arrived at the destination port. The [Buyer] raised his claim on 10 November 1995, which was after the time limitation had expired.

Above all, the [Seller] has fulfilled its obligation under the contract, and the [Buyer] had accepted all of the goods delivered. The [Buyer] did not raise any objection to the goods within the time stipulated in the contract. According to Article 39(1) of the United Nations Convention on Contracts for the International Sales of Goods (hereafter the "CISG"), the [Buyer] had lost its right to rely on the lack of conformity of the goods when it raised objection on 10 November 1995.

The [Seller] claims:

1. [Buyer] should pay the price of the goods US $126,709.57.

2. [Buyer] should pay the interest loss of US $95,407.94 calculated by the bank loan interest rate from the date the price should have been paid.

3. [Buyer] should pay the arbitration fee of US $7,000 which [Seller] has already paid.

4. [Buyer] should pay all costs of arbitration.

During the court session, the [Seller] stated that the interest should be calculated until the end of August 1996.

[Buyer]'s position

The [Buyer]'s response is that:

1. The [Seller] fundamentally breached the contract

      (1) The name, quantity, and the price of the goods were confirmed in the contract. The material and the manufacturing process were described by the sample and the blueprint written in English provided by the [Buyer]. It was clearly noted in the blueprint that hubs and axle sleeves should be made of A. S. -1008 -1020 low carbon steel, and the part of manufacturing process emphasized that "it should be coolly forged, press shaping, and no extra process. Every part should be smooth and without burrs."

These processing specifications can not only increase the hardness and strength of the steel, but also come up to the required size without any extra process. However, the [Seller] used A3 steel without permission. The [Seller] also heated the steel and pressed it into semi-finished product. After the steel cooled down, it was processed into the required size on the lathe. This kind of processing skill not only violated the contract, but also made it impossible for the material to satisfy the same hardness and strength requirement as the sample. The goods bent when being used by [Buyer]'s American customers, which proved the goods were unsafe.

      (2) In addition to problems caused by the [Seller]'s violation of these material and processing requirements, the goods do not conform to the requirement of the contract due to other serious quality problems. For instance, the hub was not concentric, the size was out of the tolerance, the screw thread was wrong, and the burr was unprocessed. There was evidence from [Buyer]'s American customer and the inspection report from Shanghai Air Machinery Company, which is the top quality inspection agency in China. There were also additional problems, such as the crack on the products that caused them to break when being used by [Buyer]'s American customers, and the inconsistency of the quantity and the name of the goods. The [Buyer] negotiated on these problems with the [Seller] repeatedly through faxes.

2. The objection to the quality of the goods

The contract between the [Buyer] and the [Seller] used the [Seller]'s sales form. The quality section was printed that "any objection to the quality of the goods must be raised within thirty days after the goods have arrived to the destination port, the inspection report issued by the [Seller]'s authorized agency is also required". These requirements are not fair and reasonable and are difficult to perform. The [Seller]'s understanding of Articles of the CISG and its quotation is erroneous and one-sided.

It should be noted that the [Buyer] has raised question to the quality of the goods within thirty days for at least three times. The issues were raised for the other two times during or even before the goods were delivered.

3. The [Seller]'s violation of the contract caused significant damages to the [Buyer]

[Seller]'s aforesaid violations of the contract and its other quality problems has caused huge damages to the [Buyer]. Until now, almost all goods are still stored in warehouses over America, which has caused big economic problems. For those items already sold, the [Buyer] should provide post sale service, such as emergency exchange. The most serious problem is the [Buyer]'s business reputation has been damaged by the [Seller]'s numerous quality problems.

Therefore, the [Buyer] asks the Arbitration Tribunal to order the [Seller] to recall all of the goods with quality problems at its own cost or delegate others to do so. The [Seller] should return the price paid by the [Buyer], US $159,668.57, and compensate all damages caused by the [Seller]'s breach of contract. However, the [Buyer] did not go through the proper counterclaim procedure as defined in the Arbitration Rules.

[Seller]'s response

The [Buyer] did not go through the proper counterclaim procedure as defined in the Arbitration Rules.

In the response to the allegations of the [Buyer], the [Seller] provided supplementary materials after the court session. The [Seller] stated that:

The current contract was for the supply of goods, processed following particular specifications, which were to be provided by the [Seller]. The evidence provided by the [Seller] shows that the [Seller] has fulfilled its obligation to deliver the goods, and there was no quality problem as asserted by the [Buyer]. The reasons for that is as follows:

1. The manufacturing blueprint (in Chinese) was confirmed and signed by the [Buyer], the [Seller], and the manufacturer. It indicated that this blueprint was the basis for manufacturing. The goods delivered by the [Seller] were in conformity with the contract. The blueprint in English provided by the [Buyer] was used during the negotiations by both parties, but it was only a reference without signatures of the [Buyer] and the manufacturer. There was no evidence to show that the [Seller] accepted the English version of the blueprint; therefore, it was not the basis for manufacturing.

2. It was noted in the processing blueprint signed by three parties on 3 May 1995 that the material was to be A3 steel, which indicated that the [Buyer] agreed to the use of A3 steel to manufacture the axle sleeves. Therefore, the [Buyer]'s claim that the [Seller] used A3 steel without the [Buyer]'s permission is not true, and is without any basis.

3. In the fax sent by the [Buyer] on 7 December 1993, the [Buyer] said that "cool forge is too expensive, and it should not be used anymore", which showed that the [Buyer] agreed to stopping the use of cool forge; therefore, the fact that the [Seller] changed the process from cool forge to heat forge was not a problem.

4. The [Buyer] confirmed the sample axle sleeves. It was only because there was no dispute about the material, heat forge, and sample axle sleeve that both parties signed Contract No. 94CQJ3-1838A1, A2 on 12 September 1994 and its Sub-Contracts No. 95CQJ3- 1838001, 95CQJ3- 183804 A, B, C.

5. The [Buyer] went to the manufacturer to check the manufacturing process on the spot several times, and never raised questions about A3 material or heat forge.

The above facts indicate that the goods delivered by the [Seller] conformed to the agreement signed by both parties. There were no problems of changing material or forge process. The [Seller] has fulfilled its obligation to deliver the goods. On the contrary, it was the [Buyer] who fundamentally breached the contract by refusing to pay after receiving the goods.

The [Seller] alleges that it has made seventeen deliveries of the goods, but only the first eight deliveries have been paid. Deliveries nine through seventeen are still not paid by the [Buyer]. The [Buyer] argues that there were problems in all seventeen deliveries. However, the [Buyer] accepted the goods and paid the price when it was complaining about the quality problems. Being cheated eight times in a row is not understandable. The fact is that before 10 November, the [Buyer] had never complained about the quality of the goods and never asked for compensation.

Regarding the validity of the quality objection clause in the contract, the [Seller] pointed out that quality clause is extremely important to the [Buyer] to protect its own legal right in international trade in goods. The [Buyer] should have known how long it would take to inspect the goods to raise quality claims. Furthermore, the quality clause reflects the true minds of both the [Seller] and the [Buyer]. The [Seller] did not use fraud or coerce the [Buyer] to sign the contract. Therefore, the quality clause is true, legal, valid, and binds both parties. The [Buyer] should have complained for compensation within thirty days upon receiving the goods, otherwise, it would lose such a right.

II. OPINION OF THE ARBITRATION TRIBUNAL ON THE FACTS

According to the documents submitted by the parties and the investigation through court session, the Arbitration Tribunal finds the following facts:

1. On 12 September 1994, the [Buyer] and the [Seller] concluded Contracts No. 94CQJ3-13838A1 and No. 94CQJ3- 1838A2. Later, the parties signed five other contracts numbered 95CQJ3-1838001, 95CQJ3-183804, 95CQJ3-183804A, 95CQJ3-183804B, and 95CQJ3-183804C on 15 February, 5 May, 8 June, 20 July, and 28 September of 1995 (hereafter "the contract").

According to the contract, the [Seller] will manufacture and sell different sizes of hubs and axle sleeves in accordance with the blueprint provided by the [Buyer]. The delivery date was from September 1994 to October 1995, and the destination ports included Memphis, San Francisco, Chicago, and Dallas.

The first two contracts listed the payment terms as D/A 120 days, and others were D/A 90 days. On the reverse side of the contract, it was stated in Section 1 that:

"Any claim arising out of the quality of the goods must be raised within thirty days after the goods arrive at the destination port, and the claims relating to the quantity of the goods must be raised within fifteen days after the goods arrive at the destination port. The inspection report issued by the [Seller]'s authorized agency must be presented. If the [Seller] is liable, the [Seller] must respond to the [Buyer] within twenty days after knowing the claim, and must give opinions of solution."

2. After the contract was concluded, the [Seller] made seventeen deliveries of the goods from November 1994 to October 1995 with a total price of US $286,378.14. The [Buyer] has received all seventeen deliveries. The [Buyer] has paid US $159,668.57 for the first to the eighth delivery, however, it has not paid the price for the ninth to seventeenth delivery, which is US $126,709.57. Both parties have no objection to the above amount.

3. The two parties provided the Arbitration Tribunal two different manufacturing blueprints, one was written in Chinese and the other was in English. It was noted in the English blueprint that the material for axle sleeves should be A. I. S. I-1008-1020 steel, and "it should be cool forged, press shaping, and need not extra process. Every part should be smooth and without burrs". There were no signatures of both parties, and no date was found.

The [Buyer] admitted that the English blueprint was used as a reference during the negotiation of the contract. It was specified in the Chinese blueprint that the material should be A3 steel, and both parties and the manufacturer signed the blueprint. It was stated that "On 3 May 1995, five changes were made at Sichuan Chengdu Dongshan Machinery Manufacture, which was confirmed by [Buyer], [Seller], and Chengdu Dongshan Machinery Manufacture". Chengdu Dongshan Machinery Manufacture was a factory that manufactured the axle sleeves in this case. Neither the [Buyer] nor the [Seller] provided the hub manufacturing blueprint to the Arbitration Tribunal.

During the process of manufacturing the axle sleeves, the [Buyer] and the [Seller] have had repeated discussions via fax. On 7 October 1993, the [Buyer] sent a fax to the [Seller] saying that "if there is no problem using heat forge, please start immediately. Stop using cool forge, because the price is higher than buying in America."

On 15 February 1994, the [Buyer] sent a fax to the [Seller] and said:

"Even though the first customer complained the price was too high, it's not impossible for them to buy. They are worried that if the axle sleeves have not been processed by modest heat; the axle sleeves cannot sustain the weight and become bent. They have tried once. Please make sure from Mr. Chen whether they did the heating process properly. The hardness should sustain 3,000 lbs, which is 1.36 ton, and the axle sleeves should sustain 1.36 2 of weight."

On 16 February 1994, the [Buyer] repeated the same contents as stated in the fax sent on 15 February. On 17 February, the [Seller] sent a fax to the [Buyer] and stated that "the manufacturer did heat properly, and they have no problem to sustain 1.36 MT weight". On 25 February 1994, the [Seller] restated the same thing in its fax sent to the [Buyer].

4. Before manufacturing and shipping the goods to the [Buyer], the [Seller] asked the [Buyer] to examine the sample goods. The [Buyer] had pointed out certain quality problem for the [Seller] to improve before manufacturing. On 28 February 1994, the [Buyer] sent a fax to the [Seller], which stated:

"After telephone conversation, our customers complained that 'the upper range was too big, which caused it to be difficult to put on to the shaft. It is a waste of time and employee's salary'. I have told the customers that it was a small problem, and it could be fixed by scrubbing more during manufacturing.

"In addition, the axle sleeves have been heated, therefore, there should be no problem. Our customers are scrubbing the axle sleeves. They may test it. If they accept, they may order thirty-forty thousands next time."

5. In the fax sent by the [Buyer] to the [Seller] on 27 October 1994, the [Buyer] said that "if the eccentric and angle problems have been improved, continue to manufacture". It also asked, "Is there a sample for the Chengdu axle sleeve? When can you manufacture one container?"

6. After the first delivery of the goods in November 1994, the [Buyer] sent a fax to the [Seller] and notified that there were problems with the quality of the goods after the customers have used the goods for the first time.

Later, the [Buyer] sent faxes on 3 October, 10 October, and 10 November mentioning that there were problems with the goods complained about by customers, but the [Buyer] never mentioned seeking compensation from the [Seller]. Nor did [Buyer] demand to have the goods inspected. In response to the problem on the No. 825, 826 axle sleeves and 01#, 02# hubs mentioned by the [Buyer] in its faxes sent on 3 October 1995 and 9 October 1995, the [Seller] stated, "it is possible that the screw thread has been damaged". In the fax sent on 11 October, it said, "No. 825, 826 screw thread, I think it is possible."

7. The [Seller] presented a report written by Chengdu XX University Metal Material Experiment Lab on 20 November 1995, which was about the bending resistance of the 03# axle sleeve. The [Seller] asserts that the report indicates that the 03# axle sleeve has reached the requirement. The [Buyer] provided following testing report:

(1) Testing Report on 03# Axle Sleeve's Centric issued by Shanghai Air Machinery Company;
(2) Inspection Report on 03# Axle Sleeve's Centric issued by AMERICA CLEVERLAND SPECIALTY INSPECTION SERVICE, INC. on 19 February 1997. (No seal);
(3) Inspection Report on the Quality of Hub issued by the foresaid America inspection agency.

The [Buyer] alleges that the above three reports indicate the axle sleeves and hubs provided by the [Seller] are non-conforming goods. The Arbitration Tribunal notes that the inspection reports presented by both the [Buyer] and the [Seller] were issued without assent by the other party. Now, each of them does not agree or accept the report from the other side.

III. OPINION OF THE ARBITRATION TRIBUNAL ON THE LAW

1. The parties did not stipulate the applicable law in the contract. However, the parties did mention the United Nations Convention on Contracts for the International Sales of Goods (hereafter the "CISG") during their statements and arguments. China and the United States are both Contracting States of the CISG, and the places of business of the parties are in the United States and China, therefore, the CISG should be applied here.

2. The inspection and compensation clause is very important for international sales contracts. The clause determines that the goods should be handed over to the inspection agency agreed by both parties within a certain period of time after the goods arrive at the destination port. If there is a quality or quantity problem, the [Buyer] should demand compensation from the [Seller] within a certain period of time. This is a common clause in international sales contracts, and it is also a trade usage. The quality clause in the instant case, which is also the inspection and compensation clause, follows the trade usage and it was agreed to by both parties.

Article 9(1) CISG states:

"The parties are bound by any usage to which they have agreed and by any practices which they have established between themselves."

Therefore, the inspection and compensation clause in the instant case is valid, and the parties should be bound by the clause. The [Buyer] should have the goods inspected by the agreed inspection agency within thirty days after the goods arrive at the destination port, and questions about the quantity of the goods should be raised within fifteen days after the arrival of the goods. If the [Buyer] finds any non-conformity of the goods, it must give notice and claim for compensation within the aforesaid time limit. The inspection report should be presented together.

3. According to the inspection and compensation clause in the contract and Articles 38, 39 CISG, the [Buyer] should have inspected the goods within the time stipulated in the contract, and given notice of the problem to the [Seller], otherwise, the [Buyer] loses the right to rely on a lack of conformity of the goods.

The [Buyer] argues that the time for inspection stipulated in the contract was too short, and that the inspection agency appointed by the [Buyer] must be authorized by the [Seller]; therefore, the contract was too harsh to perform. The Arbitration Tribunal deems that the problem is not whether the contract is too harsh, but whether the [Buyer] is going to perform or considering whether to perform. The facts show that the [Buyer] did not ask for inspection after it received the goods.

On the contrary, the [Buyer] sold the goods even before they had been inspected. The [Buyer] questioned the quality of the goods only after they had been sold, and asked for inspection without consent by the [Seller]. Therefore, it should be deemed that the [Buyer] did not perform or plan to perform the relevant provisions in the contract, which also indicates the [Buyer]'s claiming the contract was too harsh to perform is not true.

The inspection report was issued by the inspection agency only authorized by the [Buyer], and it was a violation of the contract, therefore, it should not be accepted. It should be especially pointed out that the [Buyer] commenced selling the goods even before it inspected the goods. According to international trade usages, [Buyer]'s selling of the goods, which constitutes a disposal of the goods, indicates that [Buyer] has accepted the goods. Unless otherwise determined by the contract, the [Buyer] loses the right to rely on a lack of conformity of the goods, and also loses the right for compensation.

The Arbitration Tribunal notes that the [Buyer] did not inspect the goods in accordance with the contract and sold the goods before inspection, therefore, the [Buyer] loses its right to rely on the lack of conformity of the goods and the right for compensation. The [Seller]'s claim should be accepted, which means the [Buyer] should pay the price and the interest for late payment in accordance with the contract and the CISG.

4. On the other hand, even though the [Buyer] did not inspect the goods as determined in the contract, the [Buyer] did mention quality problems to the [Seller]. The [Seller] also admitted that there might be problems with some of the goods, which indicates that some goods have problems. In the spirit of respecting facts and adhering to the principle of fairness and reasonableness, the [Seller] should take responsibility for the quality problem it admitted.

The [Seller] admits that there are quality or damage problems with No. 825, 826 hubs and 01#, 02# axle sleeves, but they still can be used. Therefore, the Arbitration Tribunal deems that the goods should be 30% discounted. The price of the aforesaid goods is US $134,527.66. The post discount price is US $94,169.36. The total price the [Buyer] should pay after discount is US $246,019.84. After subtracting the amount that has been paid by the [Buyer] US $159,668.57, the [Buyer] shall pay US $86,351.27.

5. According to Article 84(1) CISG, when the [Buyer] makes a delayed payment, he must pay the interest on it. Under the contract, interest of US $86,351.27 should be paid from September 1995 to January 1996. For the convenience of calculation, the interest on US $86,351.27 should be calculated from 1 December 1995 to the end of August 1996, which is required by the [Seller]. The Arbitration Tribunal deems that the 10.65% annual interest rate requested by the [Seller] is too high, and it should be lowered to 8%. Therefore, the interest on US $86,351.27 is US $5,181.08.

6. In its answer, the [Buyer] claims that the [Seller] should recall the goods and compensate its loss, but [Buyer] did not counterclaim in accordance with the Arbitration Rules; therefore, the Arbitration Tribunal would not consider this claim.

7. The [Buyer] shall bear 90% of the Arbitration fee, and the [Seller] shall bear 10%. The attorneys' fee and traveling fee should be borne by two parties on their own.

IV. AWARD

  1. The No. 825, 826 hub and 01#, 02# axle sleeve should be 30% discounted. The price before discount was US $134,527.66. The discount amount is US $40,358.30. The total price the [Buyer] should pay after discount is US $94,169.36. Other goods provided by the [Seller] should be paid according to the price determined in the contract.

    Based on the aforesaid paragraph, the [Buyer] shall pay the [Seller] US $246,019.84. The [Buyer] has paid US $159,668.57. Therefore, the [Buyer] shall pay US $86,351.27 and its interest. The interest shall be calculated from 1 December 1995 to the end of August 1996 at an 8% interest rate, which is US $5,181.08.

  2. The [Seller] shall bear 10% of the Arbitration fee (RMB XXX Yuan), and the [Buyer] shall bear 90%. The [Seller] has paid RMB XX Yuan in advance. The [Buyer] shall therefore repay XX Yuan to the [Seller].

  3. The other claims by the [Buyer] are dismissed.

  4. The [Buyer] shall pay the above amount within 30 days of the date upon which this award takes effect. Otherwise, interest shall be added at a 12% annual rate for RMB, and 10% for America dollars.

This is the final award.


FOOTNOTES

* All translations should be verified by cross-checking against the original text. For purposes of this translation, Claimant of the People's Republic of China is referred to as [Seller] and Respondent of the United States is referred to as [Buyer]. Amounts in the currency of the United States (dollars) are indicated as [US $]; amounts in the currency of the People's Republic of China (renminbi) are indicated as [RMB].

** Meihua Xu, LL.M. University of Pittsburgh School of Law on an Alcoa Scholarship. She received her Bachelor of Law degree, with the receipt of Scholarship granted by the Ministry of Education, Japan, from Waseda University, Tokyo, Japan. Her focus is on International Business Law and International Business related case study.

*** John W. Zhu, LL.M. China University of Political Science and Law (National Graduate Scholarship); Bachelor of Law, Southwest University of Political Science and Law; Double Degree, English Literature, Sichuan International Studies University, Chongqing, China. Focus: International Economic Law.

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