FOSFA: Practical Guidelines
The oil, seed, and fats industries have been protected and advanced by the FOSFA, which was established in London in 1863. FOSFA serves as an expansion and safety base, an arbitration administrator, and a source for boilerplate pro forma contracts. FOSFA contracts regulate eighty-five per cent of all oil and fat trade worldwide.
There are now over fifty active FOSFA contracts. For instance, FOSFA 53 is widely used for the FOB sale of various oils, including vegetable oil and fish oil. FOSFA 54 applies when the seller and buyer transact in CIF terms for the same commodity. FOSFA 4a is used for trading oilseeds and other commodities in Europe. Learn more about the inner workings of FOSFA by reading on.
What are the most critical aspects of FOSFA arbitration?
What are the most important aspects of the FOSFA arbitration to remember? All legal questions concerning FOSFA contracts should be settled in accordance with English law. There are, however, certain peculiarities to the so-called “Scott v. Avery” wording that is part of the FOSFA model arbitration agreement.
Unlike the equivalent GAFTA arbitration clause, the parties to the FOSFA dispute have no recourse to the courts for interim remedies. If the parties have added a FOSFA clause in the contract but do not want to be bound by its terms regulating the purchase of interim remedies, then the FOSFA clause is suitable. Let’s pretend this stipulation is violated (say, by one party seizing property at issue).
For that reason, the opposite party may file for an “anti-suit injunction” at the High Court of Justice to prohibit the dispute from being considered in any other form of arbitration. As a result of this judgement, the offending party will often be ordered to pay the opposing side’s costs and legal bills incurred as a result of the case.
What Else You Need to Know About FOSFA
Access to the manual and the sample files are paid for. Members of FOSFA may obtain a copy of the pre-revised pro forma contracts and regulations. As a result, FOSFA regularly updates the published arbitration rules and pro formas. These changes might drastically alter the outcome of the arbitration. Under the current FOSFA arbitration rules, the statute of limitations for claims of substandard quality, for instance, has been expanded from 120 days to one year.
Temporal constraints. The FOSFA rules vary regarding deadlines based on the kind of dispute. You need knowledgeable attorneys who can sort through the specifics to win a lawsuit. Before starting the arbitration procedure, ensure you have such experts.
Costs of Arbitration
There are a number of low-cost corporate arbitration alternatives in England, and FOSFA arbitration is one of them. Within 30 days after filing a claim, the claimant must provide a deposit of £5,000 at the first tier and £10,000 at appeal. Typically, the losing side is responsible for covering all costs.
Unlike in the GAFTA, the triumphant party in FOSFA may ask the losing party to pay for its legal costs. Nonetheless, there is no assurance that it will be fully reimbursed. Arbitrators consider the parties’ conduct, the expenditures’ relevance to the claim, and other criteria before determining whether or not to award legal fees. There have been decisions made via the FOSFA arbitration process where the arbitrators opted not to award fees to either party.
Is there a standard procedure for resolving a conflict ?
There are two rounds of arbitration in the FOSFA procedure. After the claimant appoints the arbitrator, the other party has 30 days to designate its representation. The Federation will choose a second arbitrator who will preside over the tribunal. If both parties agree, just one arbitrator will be selected.
In this agreement, applications and documentation must be submitted online or digitally exclusively. The arbitration panel will use these documents as the basis for its deliberations and decisions. In unusual circumstances, arbitrators may begin hearings by holding oral arguments.
Appealing a decision made by an arbitration panel at the first level
Any of the parties may appeal the award to FOSFA within 28 days of receiving notice of the decision. FOSFA selects the five-member Board of Appeal. The responder has 21 days to file a response to the request. When that time period expires, the parties may request more explanations from the arbitrators, just as they did in the first phase.
In the event of an appeal, the case is reexamined, and any side may submit new evidence. It is possible to appeal arbitration rulings to London’s High Court of Justice. There is a little window of opportunity to submit an appeal.
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