Sale And Purchase Agreement In Japanese

Take or pay clauses. The take-or-pay clauses are those that require buyers to pay the full volume of LNG agreed upon contractually, even if the purchasers do not receive this volume. Given that an LNG project requires a large amount of initial investment and loans, the JFTC concluded that the provision of take-or-payment clauses had “no problem in itself” under WADA. However, the JFTC found that “if a seller`s negotiating position is superior to that of a buyer and the seller unilaterally imposes take-or-pay clauses and strict minimum purchase obligations without sufficient negotiation with the buyer, even if the seller has already obtained a sufficient return for the initial investment.” This is a potentially significant finding that requires further examination. It is imposed on both buyers and sellers who sign the contract to buy and sell real estate. Background: LNG sales contracts traditionally restrict the ability of the liquefied natural gas buyer to freely resell cargoes acquired under the contract. This helps LNG suppliers manage their markets and business processes, while limiting the ability of LNG buyers to optimize their supply agreements over time. As Japan enters a phase of excessive LNG surpluses, these restrictions are increasingly being examined by both buyers and the Japanese government. On the other hand, profit sharing resulting from the resale of LNG resulting from LNG diversion can be considered a kind of compensation for changing contractual requirements, since LNG ownership and risks are transferred from the seller to the buyers at the destination port delivery location and the sellers are responsible until delivery. , that profit sharing resulting from the resale of LNG by destination diversion can be considered a kind of compensation for the evolution of contractual requirements and may be considered appropriate.

As a result, the JFTC concluded that “the use of profit-sharing clauses did not per se have a problem” under WADA. However, the JFTC stated that it would be “likely” that profit-sharing clauses “contribute to inappropriate profit sharing with a seller” or “if such clauses have some effect in preventing a buyer from reselling as a result of a seller`s request to disclose the structure of profits or costs.” It is very common for potential buyers to sign a sales contract before applying for official approval for a loan from a financial institution. As is very common, a special clause is included in the sales contracts. This clause allows “the contract to be terminated in the event that the buyer does not obtain housing credit.” If the seller requests an “intermediate deposit” in the sales contract, the buyer pays the intermediate deposit to the seller until the due date specified in the contract.