CIA Group of companies -  Terms and Conditions of Sale

Status:  January 2018

§ 1. General

1)     CIA Companies shall hereinafter be referred to as “CIA”, the contractual partner as “Client”.

2)    The following contractual provisions of CIA shall apply to all contractual relationships of the parties.

3)    These General Terms and Conditions apply exclusively. Deviating, conflicting or supplementary General Terms and  Conditions of the Client shall only become part of the contract if and to the extent that CIA has consented to their validity in writing. The requirement of written consent also applies in the event of CIA, in knowledge of the customer's terms and conditions, performing the delivery to the client unconditionally or CIA replies or refers to a letter that containing or referring to the terms and conditions of the client or a third party.

§ 2. Effectuation of the agreements

         Offers of CIA shall be non-binding unless expressly stated as being binding. Quotations are to be assessed as a request to the Client to place an order. The agreement shall be effectuated by the written order confirmation by CIA or shipment of the goods or the provision of the contractually agreed service.

§ 3. Sub-clients

1)     In order to complete the agreement, CIA shall be entitled to award subcontracts to an appropriate degree. CIA shall   be responsible for the careful selection of the sub-client/s unless the Client has expressly determined a third party.

2)    The invoicing of the costs for using the sub-clients shall be borne by the Client through CIA. The Client shall be  informed of the relevant rates before the contract is awarded.

§ 4. Intellectual property

         CIA shall exclusively own all intellectual property regarding the products and services provided in all actually known  or future types of use. CIA reserves all types of use and rights especially but not limited to manuals, documentation, explanations, quotations, diagrams, drawings and technical depictions, unless expressly otherwise agreed.

§ 5. Place of performance

1)     The place of performance shall be the business headquarters of CIA, unless expressly otherwise agreed.

2)     With the handing over of the goods to the company contracted with the shipping, the risk of accidental loss and  deterioration shall pass to the Client, even if CIA executes the shipping itself. On request of the Client, delivery shall  be covered by transport insurance at its cost.

§ 6. Delivery/performance

1)     Delivery dates or delivery deadlines, which can be agreed as being non-binding or binding, must be specified in writing. In the case that there is a delay in delivery the statutory regulations shall apply with the proviso that the 

client can only withdraw from the agreement if there is a breach of obligations for which CIA is responsible. Any     default damages shall be ruled in accordance with § 13.

2)     CIA shall obtain the goods under the agreement from suppliers and in each case concludes congruent covering  operations. CIA’s delivery duty is subject to punctual and correct self-delivery.

3)     Delivery hindrances for which CIA is not responsible (e.g. force majeure, war, natural disasters, transport or operational stoppages, import hindrances, energy and raw material shortages, government action, labor disputes as well as the breech of the co-operation duties of the Client), entitle CIA to an appropriate single-sided extension of the delivery deadline for the duration of the disturbance.

4)     CIA reserves the right to assume complete deliveries within a window of +/- 5% of the ordered quantities.

5)     CIA reserves the right to withdraw from the agreement if CIA in spite of the conclusion of congruent covering

         operations is not supplied on time or at all.

6)     This shall apply correspondingly to partial deliveries.

7)     CIA can withdraw from partial deliveries unless the Client can prove that the remaining partial deliveries are of interest to it. CIA also has the choice of withdrawing from the entire agreement unless the Client can prove that the  remaining partial deliveries are of interest for it.

8)   Partial deliveries and partial performances and corresponding invoices are permissible if they are not unreasonable for  the Client.

9)      An extension of the performance deadline shall come into force as long as the parties negotiate a modification of the performance. The delivery deadline shall not begin before the provision of the documents, authorizations, approvals necessary for executing the agreement and receipt of an agreed payment through the Client.

10)    CIA does not accept penalties, especially not because of delay in delivery.

11)    These provisions shall apply accordingly to other services by CIA.

§ 7. Characteristics of the contractual object

1)     The Client is not entitled to any rights from the design changes of the manufacturer which occur during the delivery period, unless essential or agreed functional characteristics are dropped without any replacement. CIA reserves the   right up to delivery to carry out standard technical changes, in particular improvements, if as a result only minor  changes to the quality arise and the Client is not unreasonably affected.

2)     If goods are produced or modified on the basis of the Client’s specifications CIA is not committed without a special agreement to review these specifications. The Client shall not be entitled to any claims due to faults which are based on these specifications or on goods supplied by third parties used by the Client.

3)     For all Sample deliveries CIA ask for a written release. If such an official release is not existent until the order of series,  such order and all subsequent orders of this article will recognize as release of the samples.

§ 8. Warranty

1)     The expiry deadline for claims based on defects shall be one year in the case of the purchase of new good for the purchase of used goods the provision of a warranty is excluded.

2)      The deadline shall begin with the shipping of the goods.

3)     The goods or parts thereof which reveal faults within the aforementioned expiry deadline must either be improved or  replaced by CIA free of charge in line with the Client’s choice if the cause was already evident at the time of the passage of risk.

4)     CIA must always be granted the opportunity to subsequent performance within a suitable deadline. If the subsequent performance fails the Client can withdraw from the agreement without affecting any of its claims for damages or reduce the remuneration.

5)     Claims due to faults do not exist in the event of natural wear and tear or damages which result after the passage of risk due to faulty, negligent or incorrect use, excessive strain, and unsuitable operating resources or due to special  external influences which were not assumed according to the agreement. In the course of exercising the warranty rights, the Client must provide the information required to diagnose and eliminate faults, in particular making faulty goods available for inspection, disclosing the processing steps and providing a trained and competent employee, who co-operates in the subsequent performance. In the event of a subsequent performance on site free access to the  faulty goods must be granted and if necessary other work on the production resources of the Client are to be stopped.

6)     If changes, maintenance work or subsequent performance attempts are carried out by the Client or by persons other than the technicians contracted by CIA, there shall be no claims based on faults for the above and for the resulting consequences.

7)     The claims of the Client due to necessary expenses for the purpose of subsequent performance, in particular transport and travel costs, labor and material costs, are excluded if the expenses increase because the object delivered was subsequently moved to a different location to the place of delivery, unless the transfer corresponds with its intended  use.

8)     For claims for damages, article § 13 applies of this agreement.

9)     Further-reaching claims or claims of the Client against CIA and their auxiliary persons other than those stated in the  above mentioned paragraphs due to material defect are excluded.

10)   If CIA is unwarrantedly claimed against in the course of the warranty (e.g. due to a processing error, incorrect handling of the goods, absence of a fault), the Client must reimburse all costs incurred in connection with the inspection of the goods and the subsequent performance, unless it is not responsible for the recourse.

11)   Handling the warranty CIA shall be given access to the complained materials or by choice of CIA the materials shall   be sent to CIA or any other place by the Client. CIA is authorized to test the materials in running operations and during the further processing.

§ 9. Reservation of title

1)     The goods supplied shall remain the property of CIA until the payment of all its accounts receivable, irrespective of whatever legal reason, and until all of the bills of exchange and cheques given to CIA in payment have been cashed,  even if the purchase price for especially marked accounts receivable has been paid. In the case of current account the  retention of title shall be a security for any balance due to CIA.

2)     Any processing of the reserved goods shall take place on behalf of CIA and free of charge as well as without placing  any duty on CIA so that CIA shall be regarded as the manufacturer, in other words at every point in time and degree of processing of the products retains the ownership in the products. When processed with other goods not belonging to CIA by the Client, CIA owns the new property in proportion of the invoice value of the reserved goods to the other processed goods at the time of processing. The same shall apply to the new item resulting from the processing as for the reserved goods. It shall be deemed as reserved goods in the interests of these provisions.

3)     The Client’s accounts receivable from a resale of the reserved goods shall already now be assigned to CIA to secure all accounts receivable of CIA from the business relationship irrespective of whether the reserved goods are resold  without being processed or after being processed and whether it was resold to one or several purchasers.

4)    The Client is only entitled and authorized to resell the reserved goods on the basis of a purchasing contract, contract   for services, contract for work and materials or similar contract if the account receivables from the resale passes to  CIA. The Client is not entitled to dispose of the reserved goods in any other way. On request of CIA the Client is  committed to inform the third-party the assignment of payment to CIA.

5)     If the value of the existing securities for CIA exceeds the value of its accounts receivable in total by more than 20%,  CIA is, on request of the Client or a third party disadvantaged by the excess security of the seller, committed to release securities of its choice.

6)    The Client must inform CIA without delay if third parties, through seizure, attachment, exercising the landlord’s lien or similar measures, assert rights to the equitable lien of CIA which affect or endanger the ownership and/or the indirect possession of CIA, if a third party or the Client itself has made an application to open bankruptcy proceedings over its assets or if an out-of-court settlement is aspired.

§ 10.  Remuneration

         Price fluctuations (e.g. personnel cost, raw materials) can occur, especially in long term contracts. CIA and the Client shall renegotiate the remuneration with regard to the following change request rules:

         CIA shall inform the Client regarding rising of costs (e.g. raw material, shipping, personnel costs) within a period of  14 days after the key date. The Client shall answer within a period of 14 days (accepting or refusal of changes) in  written form. If the Client does not answer the changes are not accepted. CIA is entitled to withdraw and to not to deliver the Client in future.  Agreed partial orders are not subject to this change request and will be executed. The Client is not entitled to claim for any regress if CIA withdraws from future contractual orders.

§ 11. Payment

1)     Unless otherwise agreed in writing invoices are due for payment immediately without any discounts.

2)     CIA shall be entitled to offset payments against the oldest invoice due, also in the case of opposing payment terms  of the Client.

3)     In the event of default, protest or stoppage of payment as well as if bankruptcy proceedings are opened any deferral  shall end. All accounts receivable of CIA shall be due in total immediately.

4)     In the case that the Client is in default of acceptance, CIA shall be entitled to withdraw from the agreement and to  demand damages after setting a deadline of at least 14 days.

5)     CIA shall be entitled, notwithstanding the possibility of asserting higher actual damages, to demand 30% of the purchase price for sales contracts as flat sum damages, for service agreements 50% of the agreed remuneration, each  calculated from the residual term of the agreement. The proof of the specific damage is not necessary in these cases.   The Client reserves the right to prove that CIA has not suffered any or only slight damages.

6)       Unless otherwise agreed in writing CIA refuses to pay any kind of penalties to the Client.

§ 12.  Setting off

         The Client can only set off with accounts receivable against CIA if its account receivable is established as res judicata, is uncontested or recognized by CIA. The same shall apply to the exercise of rights of retention.

§ 13. Liability, exclusion of liability

1)      CIA shall be liable for damages of the Client only if CIA acts in cases of intent or gross negligence. CIA is liable for damages of negligence regarding those contractual liabilities which are essential for the Client and whose breach  could endanger the scope of the contract if the Client trusts in this. In this case the CIA is not liable for damages which are not predictable or contractual coherent or typical foreseeable. CIA is not liable for other negligently  breaches of any other duties.

2)     The fore standing exclusion of liability is not valid in cases of personal injuries (death, body injuries).

3)     The Client shall provide CIA the production systems free of charge for the duration of the execution of the agreement (e.g. performance of the agreement, warranty, acceptance, etc.). The Client accepts limitations of the usability. Any claims of the Client therefrom irrespective of whatever kind are excluded.

4)     If liability is excluded or limited in accordance with the figures above, this shall also apply to the personal liability of the  employees, representatives and aids of CIA.

5)     Any change of the burden of proof to the disadvantage of the Client is not connected with the provisions above.

§ 14.  Disposal obligations in accordance with the electrical and electronic equipment act

1)     The hardware supplied by CIA is purely business-to-business equipment which is not intended for private use. The obligation for the correct disposal of the equipment shall herewith be transferred to the Client. The Client undertakes  to correctly dispose of the equipment delivered at its own expense after the end of utilization in accordance with the relevant legal provisions.

2)    The Client shall exempt CIA from the obligations of taking back and disposing of the equipment and the claims of   third parties connected herewith.

3)    The Client must contractually commit commercial third parties to whom it passes on the equipment and goods delivered to properly dispose of said equipment and goods after their use at their own cost in accordance with the statutory regulations and in the event of the repeated transfer of the equipment to impose a corresponding further commitment.

4)     The Client may not transfer the ownership of the goods delivered to a third party if the justified suspicion exists that the third party would breech these contractual conditions, in particular would not dispose of the equipment correctly.

5)     If the Client passes on the equipment to third parties in the course of normal business transactions without being the manufacturer in line with the electrical and electronic equipment act, the Client commits to CIA immediately after passing on to provide written proof that the third party has also been committed in line with further commitment of the third party in the course of the further commitment. The information to CIA must contain the serial number of the equipment as well as the proof of the further commitment of the third party by means of submitting the  commitment declaration.

6)     If the Client fails to contractually commit third parties to whom it has passed on supplied equipment to dispose of the  equipment and to further commit, the Client is committed to accept the goods delivered at its own cost and to dispose of them correctly in accordance with the statutory regulations.

7)     CIA’s claim to assumption and exemption by the Client shall not expire before two years after the final termination of the utilization of the equipment. The two-year suspension of the expiration of prescription comes into effect only with  the receipt of a written declaration from the Client to CIA regarding the termination of utilization.

8)     CIA reserves the right to make a separate agreement differing hereof with the Client in writing about the return of the equipment.

§ 15.  Export

If applicable, the goods supplied by CIA shall be subject to the international export controls and embargo

regulations. The export from Hong Kong and the import into third countries is only permissible with the agreement of  the relevant authorities (possibly several states and the EU). The Client undertakes to keep itself informed about the statutory regulations on a case-by-case basis and to obtain the necessary authorizations as well as to pass these on to CIA.

§ 16.  Non-disclosure

1)     The parties agree to maintain confidentiality about all contractual contents, in particular the scope of the agreement, remuneration provisions as well as the skeleton and individual agreement. This commitment also exists after the  agreement has been terminated.

2)    The parties agree to a contractual penalty to the amount of $33,300.00 excluding the continued offence principle without prejudice to the opportunity to assert higher actual damages, for each case of a breach of this non-disclosure commitment.

§ 17.  Place of jurisdiction

         The sole place of jurisdiction for any disputes from the contractual relationship of the parties and the related legal   relationships is Hong Kong.

§ 18.  Choice of law

         Solely Hong Kong law shall apply under exclusion of the UN convention on contracts for the international sale of goods and under exclusion of those clauses which refer to the laws of other countries.

§ 19. Written forms

         Any amendments or supplements to the agreement, individual agreements and assurances must be made in writing.  This shall also apply to the need for the written form.

§ 20. Non-escape clause

         If provisions of these Terms and Conditions should be or become partly or wholly void, the remaining conditions will  continue to apply. The parties are bound to replace the void provision or the void part of the provision by a legally valid arrangement, which comes as close as possible to the commercial meaning and purpose of the void provision or part of the provision.