General Sales Terms

1. Seller And Application

These terms apply to sales by Saneco Corporation and its subsidiaries where incorporated into the sales contract. “Seller” means the legal entity named in that contract. Where a separate export company is used, its correct legal name must be stated and it must expressly adopt these terms.

The signed sales contract, agreed specifications and written amendments prevail over conflicting provisions in these terms. Mandatory legal rights remain unaffected.

2. Quotations And Order Confirmation

Quotations are valid for 14 calendar days from issue, unless otherwise agreed in writing. Prices and payments are in EUR or USD, as specified in the sales contract.

An order is confirmed when both parties sign the sales contract and exchange signed copies by email, unless another written confirmation process is expressly agreed. Silence does not constitute acceptance.

The contract records the agreed products, quantities, specifications, price, delivery basis and payment terms. Production begins after receipt of the advance payment, final specifications and any required sample approvals. Changes require both parties' written agreement, including any resulting price or timing changes.

3. Exchange-Rate Adjustments

The exchange-rate reference is the Industrial and Commercial Bank of China (ICBC) published foreign-exchange buying rate for the invoice currency, EUR or USD, against RMB.

Compare the rate on the date both parties have signed the sales contract with the rate on the date the goods are ready for shipment. Use the last published rate for each date, based on Beijing time. If no rate is published on a relevant date, use the last published rate on the preceding publication date. Use the same rate type and currency units for both dates and retain the published records.

If the rate increases or decreases by 3% or more, only the unpaid 70% balance is adjusted. The 30% advance remains unchanged. No adjustment applies to a movement below 3%.

The percentage movement is measured against the signing-date rate: (goods-ready-date rate / signing-date rate - 1) x 100. The adjustment is triggered at +3% or above, or -3% or below, using the published rates without rounding the percentage before comparison. Both rates are expressed as RMB per the same number of units of EUR or USD. Once the threshold is reached, the adjusted balance is:

Original unpaid balance x signing-date rate / goods-ready-date rate.

The formula applies the full exchange-rate movement once the 3% threshold is reached, not only the part beyond 3%. Round the resulting balance to two decimal places in the invoice currency. The adjustment can increase or decrease the balance and is not a flat 3% surcharge.

The Seller will supply the rate comparison and calculation with the balance pro-forma invoice. The exchange-rate comparison stops at the goods-ready date; later payment does not create further adjustments under this clause. Other price changes after signing require both parties' written agreement.

4. Production Timing

Production generally takes 55–65 days after all applicable prerequisites are met: signed contract, agreed specifications, sample approval where required and receipt of the advance payment. The applicable schedule is stated in the sales contract.

Production readiness, shipment and arrival are separate milestones. Transit time is additional. The Seller will confirm the actual goods-ready date by email and promptly notify the Customer of anticipated delays and revised timing.

5. Payment

Unless otherwise agreed in writing, payment is 30% in advance and the remaining 70%, subject to the exchange-rate clause, within 15 calendar days after both:

• the goods are ready for shipment; and
• the balance pro-forma invoice has been emailed to the Customer.

Where these occur on different dates, the payment period is counted from the later date, with the following calendar day counted as day one. The invoice will show the resulting payment deadline. Full payment is required before shipment, even if shipment is requested before that deadline.

Starting on the day after the payment deadline, the remaining unpaid balance bears simple interest at 0.1% per day until payment is received, subject to applicable mandatory law and any adjustment by a competent court or tribunal. Interest is not compounded or backdated to the first 15 days. Partial payments reduce the balance on which further interest is calculated.

The Seller may withhold shipment until full payment and, after written notice, suspend affected work for overdue payment. A cancellation request does not itself suspend payment obligations.

6. Delivery, Costs And Risk

Each sales contract must identify the agreed Incoterms® 2020 rule and named port or place. Costs, delivery obligations and risk follow that rule unless an express written variation is agreed.

For FOB shipments, the Seller handles appropriate packaging, export clearance and delivery on board the nominated vessel at the named port. The Customer arranges and pays for main carriage and bears import obligations and other costs allocated to it by FOB. Risk normally transfers on board, subject to the rule's provisions for Customer default.

Where goods are handed to a carrier before loading on board, including relevant container shipments, an appropriate term such as FCA should be selected instead. Assistance with freight arrangements does not by itself change the agreed allocation of costs or risk.

7. Ownership

To the extent permitted by applicable law, ownership of the goods remains with the Seller until their purchase price is paid in full. Risk transfers separately under the agreed Incoterms rule. This clause does not claim ownership of other products into which the goods are incorporated.

8. Pre-Shipment Inspection And Costs

The Seller performs its own quality checks at its own expense.

The Customer may arrange its own or an independent pre-shipment inspection at its own expense. Customers wishing to inspect should notify the Seller in advance. The inspection must be completed within five calendar days after the Seller emails confirmation that the goods are ready and available for inspection, unless an extension is agreed in writing.

The Seller will provide reasonable access during the agreed inspection window. If the Seller cannot make the goods available, the window runs from when access is provided. Where inspection has been requested in advance, shipment will take place after that inspection or expiry of the window, unless the Customer waives the pre-shipment inspection.

Failure by the Customer or its appointed inspector to complete the inspection within the window does not automatically extend the payment deadline or postpone shipment. Shipment remains subject to full payment and the agreed delivery arrangements. A timely reported nonconformity will be dealt with under the claims provisions and applicable law.

All inspection, testing, report and certificate costs arranged by the Customer, including repeat inspections, are borne by the Customer unless otherwise agreed in writing or required by mandatory law. The Seller remains responsible for the cost of its own checks.

Pre-shipment inspection, or the decision not to inspect, does not remove rights relating to hidden defects or rights that cannot lawfully be excluded.

9. Claims And Independent Certificates

The Customer must notify the Seller by email of visible defects, shortages or apparent nonconformity within 15 calendar days after physical receipt of the goods.

Claims must be supported by an independent inspection and a written inspection report and certificate from a suitably qualified independent inspection body. The documentation must identify the order, products, affected quantities and the findings against the agreed specifications. A certificate or report from the Customer alone is not sufficient.

The inspection body and scope should be agreed with the Seller before the inspection; agreement must not be unreasonably withheld. Notification must still be made within the 15-day period if a certificate is not yet available. Any additional time for providing the required certificate must be agreed in writing.

Hidden defects must be reported promptly after discovery within the applicable warranty period and supported by the same independent inspection documentation, subject to overriding legal rights. The 15-day visible-claims deadline does not cut off hidden-defect claims.

The Customer should preserve affected goods and relevant evidence for assessment. Goods must not be returned without prior written agreement on the return arrangements and costs. The independent-certificate requirement applies to contractual claims to the extent permitted by mandatory law.

10. Warranty

The warranty covers conformity with the agreed specifications and manufacturing defects. The warranty period, normally 12 months from shipment, will be expressly confirmed in the sales contract.

Warranty claims require an independent inspection report and certificate under clause 9. For a valid claim, the Seller will arrange an appropriate repair, replacement or refund for the affected goods in accordance with the contract and applicable law.

Damage caused by improper storage, installation, use or unauthorised modification is excluded to the extent permitted by law. Mandatory legal rights remain unaffected.

11. Customer Cancellation

Confirmed orders may not be cancelled, reduced or postponed for the Customer's convenience without the Seller's prior written agreement. In particular, OEM and other custom orders are not cancellable at the Customer's option once materials have been ordered, tooling commissioned or production started, subject to mandatory termination rights.

A cancellation request does not by itself release the Customer from its obligations. If the Seller agrees to cancellation, the Customer must compensate the Seller for reasonable, documented and non-recoverable costs and losses caused by cancellation, unless the written settlement expressly provides otherwise. If the Customer cancels without consent, abandons the order or refuses to accept conforming goods without a contractual or legal right, the Seller may also claim recoverable losses arising from that breach.

Recoverable losses may include committed materials, tooling, work in progress, completed goods, supplier cancellation charges and reasonable storage or disposal expenses. Other foreseeable losses, including provable lost profit, may be recovered to the extent permitted by the contract and applicable law.

The Seller may apply the advance payment against these amounts. The Customer remains liable for any shortfall; liability is not limited to the 30% advance. Any surplus is refunded after the cancellation account is settled.

The Seller will take reasonable steps to reduce its loss. Avoided costs, recoveries and resale proceeds must be credited, with no double recovery of the price and costs for the same goods or loss.

If the contract is validly terminated because of the Seller's unexcused failure to perform, amounts paid for the affected undelivered goods are refunded, without an automatic additional 10% penalty. Other applicable remedies remain available. Force-majeure termination is dealt with separately below.

12. Force Majeure

A party is excused from affected performance only to the extent prevented by an event outside its reasonable control that could not reasonably have been foreseen at signing or avoided or overcome.

The affected party must promptly notify the other party by email, provide reasonable supporting information, reduce the effects where possible and resume performance when able. Relief lasts only for the affected period and does not excuse an earlier default.

If disruption continues for more than 120 days, either party may terminate the affected unperformed portion by written notice. Payments for undelivered goods are refunded, with any alternative treatment of identifiable work or goods retained by the Customer agreed separately in writing. Mandatory termination rights remain unaffected.

13. Governing Law And Disputes

Unless the sales contract states otherwise, the contract is governed by the laws of mainland China. The Seller is the legal entity identified in the sales contract.

Any dispute connected with the contract shall be referred to the ICC International Court of Arbitration and finally resolved under the ICC Arbitration Rules. The parties may agree the place and language of arbitration and the number of arbitrators in the sales contract. If they do not, these matters will be determined under those Rules.

14. Notices And Amendments

Notices may be sent by email to the addresses designated in the sales contract, subject to mandatory requirements. Each party must keep its contact information current. Time periods are calendar days unless otherwise stated, with the day following the triggering event counted as day one. Amendments require written agreement by both parties.