Cross Trades
For a transaction and movement to be deemed a cross trade, the following elements are required…
- A manufacturer – your supplier
- A trader who is buying the product and selling it on – i.e. you.
- An end user – i.e. your client.
- The movement of goods between the manufacturer and end user, whether or not either of the parties are in the UK.
- Two contracts, the first being between the manufacturer and trader, the second being between the trader and end user.
The key to successful cross trades / cross trading is preventing the two parties at either end of the chain from learning the identity of the other. At FAEFA, we work with clients to ensure that the documentation used to describe the two transactions prevents this from happening. We are also mindful that each country has its own set of rules which require a variety of pieces of information to be disclosed. We are great believers in preventative medicine so we research the specific requirements of your project in conjunctions with our agents and associates in order to avoid nasty surprises later on.
One of the most important parts of setting up this kind of movement, is ensuring that you get paid. In addition logistics and documents, we will be pleased to discuss the financial side of things with you and assist with the elements of a letter of credit, if that is the route you choose to pursue.
