A high sea sale agreement, also known as HSS, is a contract between two parties to sell goods while the goods are still in transit. This type of agreement is common in international trade, where the buyer or seller may wish to modify the terms of the original sale agreement. HSS agreements are often used to avoid customs duties and other taxes.
The HSS procedure involves various steps that need to be followed to ensure that the agreement is legal and binding. Here are the steps involved in a typical high sea sale agreement procedure:
1. Identification of the goods: The first step is to identify the goods that are subject to the HSS agreement. The buyer and seller must agree on the goods, their quantity, quality, and value.
2. Assignment of rights: In an HSS agreement, the original buyer assigns their rights to the goods to the new buyer. This is to ensure that the new buyer becomes the legal owner of the goods.
3. Amendment of original sale agreement: The original sale agreement between the seller and the original buyer needs to be amended to reflect the changes made in the HSS agreement. This amendment must be agreed upon by all parties involved.
4. Payment and documentation: The new buyer is required to make payment for the goods to the original buyer. The payment can be made through a bank transfer or other means agreed upon by the parties. The new buyer must also provide documentation to show that the goods have been sold to them.
5. Customs clearance and delivery: Once the new buyer has made payment, the goods can be cleared through customs. The new buyer is responsible for arranging for the shipment of the goods and for taking possession of them.
It is important to note that the HSS procedure can be complex, and it is advisable to seek legal advice to ensure that all legal requirements are met. Failure to follow the proper procedure can result in legal problems and financial losses.
In conclusion, the HSS procedure is a useful tool in international trade for buyers and sellers who wish to modify the terms of a sale agreement while the goods are in transit. By following the steps outlined above, parties can ensure that their HSS agreement is legal and binding, and they can avoid customs duties and taxes.