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Writer's pictureAvv. Giovanni Babino

Rules to protect exports - The EX WORKS (EXW) clause!



Among the main problems of buying and selling abroad, we must include that concerning the appeal to the Judicial Authority in the event of contractual breaches.


In export operations, it is common for the buyer, an entity based abroad, not to pay the price of the goods purchased.


The need therefore arises to appeal to the Judicial Authority, and different assessments must be faced depending on whether the debtor buyer is based in a non-EU country or in an EU country.


Difficulties can be avoided by inserting the "ex works" clause, also known as an ex works clause, in contracts concerning the sale of movable goods, the validity of which is internationally recognized (Incoterm).


With the ex works clause, the purchased goods must be delivered to the seller's factory or establishment.


In the case of the sale of goods, concluded with entities based in non-EU countries, the inclusion of the ex works clause offers the seller the possibility of appealing to the Judicial Authority in his country for a trial or a payment order towards the foreign entity established abroad.


In the case of the sale of goods to buyers based in an EU country, the European Regulations must be evaluated which often derogate from the international conventions that apply to non-EU countries.


The need therefore arises to appeal to the Judicial Authority and therefore it is necessary to ascertain which jurisdiction is competent within the EU countries.


The inclusion of the ex works or ex works clause in the sales contract, and the provisions of EU Regulation 1215/2012 regarding jurisdiction, offer the solution.


the reg. EU 1215/2012 regarding jurisdiction, art. 5 establishes that "persons domiciled in the territory of a Member State may be sued before the courts of another Member State only in accordance with the rules referred to in sections 2 to 7 of this Chapter".


In the context of the sale of goods within the European Union, art. 7 letter b) of the said regulation, provides that a person domiciled in a Member State may be sued before the court of the place of performance of the obligation brought before the court. In the case of the sale of goods, the place of performance of the inferred obligation is the place where the goods were or should have been delivered according to the contract.


In consideration of the Ex Works clause, the place where the goods were or should have been delivered is the place where the seller's domicile is located. In this way, the creditor seller can appeal to the Judicial Authority of his country and does not have to appeal to the Judicial Authority of other EU countries.


The EXW Incoterm certainly represents, within the context of exports carried out by Italian operators, (it is estimated that approximately 80% of export contracts are signed with the use of this contractual clause) the preferred method for the sale of goods. products as, from the seller's point of view, it represents the least demanding contract in terms of obligations and fulfilments. In fact, the national transferor manages to correctly fulfill the stipulated contract, limiting itself to preparing the agreed goods in its own premises by the agreed date, thus avoiding having to identify a transporter, negotiate on the price, deal with customs formalities, insurance of the goods and everything else. what appears to be inherent to an international shipment, but above all avoiding having to contact the foreign judicial authority in the event that it is necessary to appeal to the Judicial Authority.


Milano, February 7th 2017.

Avv. Giovanni Babino

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