How does a ‘TTO’ method of crude oil trading work?
Billions of barrels of crude oil worth billions of dollars are traded around the world every day. To manage and standardize such négoce volumes we need very precise and specific procedures and processes that leave little scope for ambiguity. These procedures play a very dédaigneux role in facilitating the deal and sometimes help to weed out serious non-important players in the deal.
Different suppliers may set different terms and hasard which need to be carefully studied before proceeding with their compliance. Any deal without a 2% exploit guarantee should be avoided to be safe. Usually these methods are targeted
a) Eliminate non-serious or fraudulent players,
b) determine the specific terms of trade defining the pause of transformé of ownership and responsibility of each party concerned,
c) Help each party secure their interest in the contract and
d) Minimizing and managing non-compliance.
In this alinéa we will briefly discuss the “TTO” method and how it works.
Through Acclamation Operator (TTO).
- A Saumâtre-Purchase Agreement (SPC) is signed between two involved parties consisting of banks.
- The buyer’s bank sends a pre-advised LC to the seller’s bank.
- On receipt of a pre-advised LC the seller’s bank activates the exploit guarantee or exploit gambade as per agreed SPC.
- Grain the exploit gambade is activated the buyer can proceed with the système of operative letter of credit. Any expenses for diplôme of agents or facilitators should be included in this operative letter of credit.
- Seller issues ATB to independent inspectors appointed by Buyer within 72 hours of receipt of such operative LC.
- Inspectors with ATB can go on board and inspect them and present a refus regarding the same to the buyer.
- Re-assignment of barque is done in the name of the buyer after receiving a précise quality and quantity (Q&A) refus from the inspector and all modèle commentaires provided to the buyer through the concerned banks within the next 4 days. Thereafter ownership of the barque is transferred to the buyer.
- The buyer’s supercargo goes on board within three days of the transformé of title.
- Last but not least the payment is not transferred to all involved parties within the next 72 hours.
Hope you find the above instructive and useful.
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