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Cocoa Products Standard Contracts
Because of the void in comprehensive cocoa "products" contracts, ECA initiated early 2002 the creation of a joint ECA-CAOBISCO-FCC Contract Working Group (“JCWG”) in charge of defining such contracts. The FCC (Federation of Cocoa Commerce) has its own arbitration structures covering its extensive rules governing cocoa beans contracts, but hitherto not for cocoa products.
Indeed, semi-finished products ("Products") such as (liquid) butter, liquor, powder, pressed cake, etc., and intra-European (e.g. tank truck) movements had never been standardised. Consequently, sellers and buyers often did not recognise each other's terms leading, despite having been the tradition for decades, to insecurity on both sides.
The tripartite JCWG regroups "experts" from companies from the chocolate manufacturing industry (CAOBISCO), from the trade (FCC and ECA) and from the converting & industrial chocolate manufacturing (ECA).
Current participants to the Working Group include:
Karel Menu, UNICOM INTERNATIONAL, chairman, nominated by ECA
Wim Groen, THEOBROMA, nominated by FCC
Darrell High, NESTLE, nominated by CAOBISCO
Eef Paalvast, CARGILL-GERKENS, nominated by ECA
Filipa Secretin, BARRY CALLEBAUT, nominated by ECA (also current FCC Contracts Committee chairperson)
Hans van Leeuwen, ADM COCOA, nominated by ECA
ECA, handling the Secretariat, also attends
Former participants include Alan Cook (ex- CADBURY-SCHWEPPES, also past FCC chairman), Cécile Delestre (NESTLE), Stéphane Masseran (MASTERFOODS) and William Venables, former W.G. chairman (at the time from ED&F MAN, now ARMAJARO).
During its first meeting in June 2002, members of the JCWG unanimously agreed to work under the FCC contractual framework, recognizing thereby its leading role regarding contracts and arbitration. [joint communiqué]The JCWG differentiates between five types of Cocoa contracts: Liquid Products (CP1), Packed Products on Buyer's call (CP2), Shipment of Packed Cocoa Products (in containers) on CIF terms (CP3), Shipment of Packed Cocoa Products on FOB terms (CP4) and Door to door Shipment of Packed Cocoa Products (CP5). It completed CP1 and CP2 [document CP1–CP2] both available on FCC website and is at the final stage for CP3.
Not an easy task. The JCWG has invested so far in excess of 400 man-days in meetings alone, under the wise guidance of its two chairmen, and the goodwill of all participants. Its next challenge will be the completion of CP4 and CP5.
