Compensation Trade-What is compensation trade?
Compensation trade - an overview of compensation trade
Compensation trade, also known as buy-back refers to the transaction in the other party to offer credit based on the import of equipment and technology, and then the device technology products, staging equipment and technology help meet the price of imports and interest.
Compensation trade - the types of compensation trade
In accordance with the subject of a different payment, compensation can be divided into roughly three categories:
A direct product of compensation. That the two sides agreed in the agreement, the direction of the import of equipment from the equipment supply side promised to purchase a certain amount or the amount produced by the device directly to the product. Limitation of this approach is that it requires the direct product produced and its quality must be each other's needs, or are available in the international market, sell, otherwise not easily accepted by the other party.
2, compensation for other products. When the transaction device itself does not produce material products, or equipment produced direct product of non-other necessary or bad in the international market, when sales may be both necessary and possible consultations with the purchase other products instead.
3, labor compensation. This practice is common in the same processing or a combination of small and medium sized component assembly in compensation trade. Specifically, this: The two sides of the agreement, are often purchased by the other party on behalf of the necessary technology, equipment, advance payment by the other party. Our request by the other side, after processing, from processing charges receivable owed in installments deducted also.
The above-mentioned three kinds of approaches can be used in combination, namely, comprehensive compensation. Sometimes, according to the actual needs of the situation, but also partly by a direct product or other products or services, compensation, partly in cash payments.
Compensation trade - the basic features of compensation trade
Compensation trade as compared with the general trade, with the following two basic features:
(1) carry out compensation trade credit is indispensable precondition.
(2) The equipment supplier must be committed to purchase equipment, the importer of the products or services, which constitutes a prerequisite for compensation trade.
It should be clear that, in the credit based on the import of equipment does not necessarily constitute compensation trade, compensation trade, requires not only equipment supplier to provide credit, while also committed to purchase each other's products or services, so that the other party with the proceeds of the loan money . These two conditions must be met, are indispensable.
In addition, carry out compensation trade, compensation trade between the two parties signed an agreement.
Finally, it should be noted that the conduct compensation trade should pay attention to the following questions: First, to do well the project feasibility study; Second, we should reasonably calculate the cost and arrangements for the loan repayment period; Third, we must correctly handle the compensation for the export of products and normal relations.
Compensation trade - the role of compensation trade
Compensation trade in equipment and the roles of technology import
Compensation trade enterprises to import equipment and technology for addressing their lack of funds for equipment renewal and technological transformation of the problem, so that products can upgrade to enhance the market competitiveness (including the international market and domestic market). Equipment, technology import side will buy-back, in the cover price of equipment and technology, while also using the equipment exporter sales channels in foreign countries, so that products into foreign markets to import equipment and technology to boost the export of products, known as the "Progressive to bring out "approach, is a contemporary one of the major characteristics of small compensation trade.
To compensation trade imported equipment and technology, often not very advanced, and even used equipment. However, if the product can marketing and the market outlook remains positive, equipment at reasonable prices, then for developing countries to increase exports and expand domestic employment opportunities and improve the region's economic development level is still beneficial.
Compensation trade, the role of technology export side
Exporter in the provision of credit, based on the expansion of equipment and technology exports. The exporter for the transfer of industries, our needs, compensation trade way through the transfer of industries to developing countries, where it won both the purchase price for the transfer of equipment and technology, and from the sale of goods resold to a profit, can be described as a double benefit.
