[별표 31]

GENERAL PROVISIONS FOR CONTRACT

[별표 31]GENERAL PROVISIONS FOR CONTRACT

Article 1. SCOPE

General Provisions for Contract (“GP”) shall apply to the procurement of goods and/or services to be purchased by the Korea Railroad Corporation(KRC) of the Republic of Korea.

Article 2. DEFINITIONS AND MEANING

The following terms and abbreviations used herein shall have the meanings as set forth below:

1. “Month” means calendar month.

2. Word importing the singular meaning suggests that the context includes the plural meaning and vice versa.

3. “Defaulted Contracting Party" refers to:

(a) a person or entity that had delayed delivery for more than 134 days without valid reason within one year before the bid opening date.

(b) a person or entity that had been forfeited warranty bond caused by unsatisfied defect action within one year prior to the bid opening date.

4. Terms not otherwise defined herein shall have the meanings ascribed to the Instructions to Bidders for Foreign Contract ("ITB").

Article 3. LANGUAGE OF DOCUMENTS

All documents such as bids, transport documents, shipping advices, markings, drawings, instruction manuals, bid bonds, performance bonds, letters, telexes, facsimiles, etc., in connection with the contract under the General Provisions for Contract shall be made in Korean and/or English unless otherwise authorized by KRC.

In case where any conflict arises as to the interpretation of these two versions, the Korean version shall prevail.

Other printed literature furnished by the Bidder may be written in another language provided that it is accompanied by a Korean and/or English translation of its pertinent passages, in which case, for the purposes of interpretation of the bid, the Korean and/or English translation shall govern. However, the bid for goods manufactured in Korea may be written in Korean.

Article 4. COMPUTATION OF TIME

The number of days means calendar days including Saturdays, Sundays and holidays. However, in the case where the expiry date falls on a Saturday, Sunday or holiday, the expiry date shall be extended to the following business day.

Article 5. CONTRACT DOCUMENTS AND GOVERNING PRIORITY

①Contract documents shall consist of contract form, bid documents, final quotation, bid announcement, request for proposal, the GP and the ITB.

② In the event of conflict between stipulations in the contract, the governing priority shall be;

First : Contract Form

Second : Bid Documents or Final Quotation,

Third : Bid Announcement, or Request for Proposal

Fourth : ITB

Fifth : GP, in the order as stated.

Article 6. PERFORMANCE BOND

①In the case where deposit of the performance bond is a must, the overseas Bidder or overseas Supplier shall establish a performance bond through the advising bank of the letter of credit, before execution of contract, in the form of irrevocable clean credit, cash, certified check or bank guarantee, in favor of KRC in the amount not less than ten percents(10%) of the contract value. However, the performance bond establishment can be established after execution of contract upon permission by KRC.

The performance bond shall be valid three(3) months after the latest shipping date or any extension thereof, payable in the currencies of the contract and available for payment against KRC's certificate stating that the Bidder and/or the Supplier has failed to comply with terms and conditions of the contract.

(b) In the case where a performance bond is established by a domestic Bidder; the domestic Bidder shall establish a performance bond in favor of KRC, before the conclusion of a contract, in the amount not less than ten percents(10%) of the contract value, in the form of cash (including check issued by the Post Office or a financial institution subject to the Banking Act), or a guarantee specified in Article 37② of the Enforcement Decree of the Act on Contracts to which the State is a Party, payable in Korean Won, and the Bidder shall jointly take responsibility for depositing the performance bond in the case where the overseas Supplier under clause ① fails to deposit the performance bond.

③Performance bond shall be released upon instructions of KRC after satisfactory completion of the contract, or on its expiry date, whichever comes first.

④Successful Bidder and Suppliers can jointly establish the performance bond.

⑤In the case where the contract amount is less than US$40,000(forty thousand dollars), KRC may exempt the Contracting Party from the obligation to deposit a performance bond.

Article 7. GENERAL SPECIFICATIONS

①All goods furnished under the contract shall be in compliance with the specifications stipulated in the contract, and shall be new and unused stan-dard products, suitable in all respects for the services inten-ded, manufacturer's most modern design, and equivalent or superior in all respects to products regu-larly supplied to the domestic trade by the manufacturer.

②Spare parts furnished shall be identical to original parts. Points not adequately described by the contract specifications shall be in accordance with the best commercial practices, and shall be sound, true to patterns, and free from injurious defects.

③All fittings necessary to complete the equipment shall be furnished by the Contracting Party at no additional charge beyond the price specified in the contract, whether or not mentioned in the contract specifications. Except when otherwise provided in the contract, no payment for extras shall be made unless such extras and price thereof have been authorized by KRC.

Article 8. WARRANTY

①The Contracting Party shall guarantee that, at the time of delivery, the goods supplied under the contract will be free from any defects in material or workman-ship and conform to the require-ments of the contract notwith-standing the fact that the Korea Railroad Corporation may have inspected and/or accepted the goods.

②The warranty period shall be governed by the contract and the Bid Invitation, and this guarantee shall be valid one year, unless otherwise provided for in other terms and conditions.

③If the Bid Invitation or the contract requires a deposit of warranty bond, the Contracting Party shall deposit a warranty bond 5% or more of the contract price to KRC by the last day of inspection of the Goods. If individuals fall under the effects within 365 days before the bid opening date as Article 2. 3. “Defaulted Contracting Party" shall deposit the warranty bond in an amount equal to 10% or more of the contract price (A deposit is required even if the warranty period is less than one year).

④Validity period of the warranty bond shall be the warranty period, all other procedures and methods of the deposit of the warranty bond not provided in this section shall apply to Article 6 hereof.

⑤Notice of any such defect or non-conformance shall be given by the End User to the Contracting Party within the warranty period if the defective or nonconforming Goods are found and the End User shall arrange the deadline for the Contracting Party to submit the report on measures of the defect or non-conformance and shall notify to KRC contract department of the relevant information.

⑥In the event that the Contracting Party has received the notification of clause 5 above, the report on measures of the defect or non-conformance is required to submit to the End User and KRC contract department without delay within the period of arranged by the End User and the Contracting Party shall notify the result of measures of the defect or non-conformance after the measures have been processed. The Contracting Party shall include the causes of defect or non-conformance, detailed measures and schedule etc. in the report on measures of the defect or non-conformance.

⑦The Contracting Party shall take measures in accordance with the following methods.

1. measures of defect or non-conformance by means of maintenance, repair, parts replacement, etc.

2. If a supply of substitute goods is demanded by the End User, the Contracting Party shall refurnish it to the delivery place (final destination) as stipulated in the Bid Invitation or the designated site by the End-User, in conformity with the contract specifications.

3. If the End User requires a refund for defective or non-conforming goods, the Contracting Party shall return portions of the contract price equivalent to the effects of damage.

⑧The warranty period for the substitute Goods in clause (g) 2 above shall continue for the period prescribed in clause (b) above from the last day of inspection of the substitute Goods.

Article 9. VARIATION IN QUANTITY

No variation in the quantity of any item called for by the Contracting Party will be accepted unless such variation results from conditions of loading, shipping or packing, or allowance in manufacturing processes, and then only to the extent as specified in the contract.

Article 10. INSPECTION

(a) General Requirements

1. If independent inspection is deemed necessary, KRC, within a reasonable amount of time from the effective date of the contract shall appoint an inspector to inspect, at the Contracting Party’s expense the Goods prior to delivery. It shall be the Contracting Party’s responsibility to advise the inspector that the Goods is ready for inspection at least twenty(20) days prior to the delivery.

2. The Contracting Party shall furnish the inspector with all reasonable facilities and assistance, including records of all inspection performance made by the Contracting Party to enable the inspector to fulfill his obligation and responsibilities. Upon receipt of such advice, the inspector shall inspect the Goods without delay and will promptly and immediately issue a certificate of inspection for the Goods.

3. The inspector shall have the authority to reject any Goods which are found to be defective in material or workmanship, or otherwise not in conformity with the requirements of the contract. In the event the inspector disapproves any Goods, the Contracting Party may tender additional quantities for inspection and approval in lieu of the Goods disapproved, provided such tender is made during the term of the contract.

4. In the event the inspector fails to inspect the Goods within twenty (20) days after being advised that the Goods is ready for inspection, the Contracting Party shall select, subject to the End User’s approval, an independent inspector to inspect the Goods at the Contracting Party’s expense.

5. At the discretion of the End User, the End User has a right to reject the entire quantity if any portion of the total Goods contracted is disapproved by the inspector. The Contracting Party shall be responsible that the Goods delivered to the End User is the same Goods as described in the certificate of inspection.

(b) Inspection Requirement

Goods to be supplied under the contract shall be inspected and tested by the inspector appointed by the End User as to the following points, if applicable:

(1) Physical and chemical properties of materials or elements incorporated

(2) Workmanship and quality or construction, fabrication, and assembly of Goods.

(3) Performance test and operating test of Goods.

(4) Weight and quantity.

(5) Packing conditions and markings.

(6) Points to be further specified in the contract.

③ Inspector's Mark

All Goods inspected under the contract shall be stamped, stenciled or labeled with the inspector's emblem. If it is not practicable to mark the Goods with the inspector's emblem, the containers in which the Goods are packed shall be so marked. The size of the inspector's emblem may vary depending upon the size of the Goods, packages or shipping containers to be marked.

Article 11. DRAWINGS AND MANUFACTURER'S INSTRUCTIONS

(a) In the case where a contract requires approval of the drawings, within reasonable allowance of time required by KRC, the Contracting Party shall forward by air mail to the End User such documents prepared in English as required below with the relevant contract number and other reference numbers on each copy, if applicable;

(1) General arrangement drawings.

(2) Installation drawings showing weight and dimension of the heaviest part/s.

(3) Electric wiring circuit diagrams and list of electrical speci-fications.

(4) Assembly and sub-assembly drawings.

(5) Lubrication system circuit diagrams.

(6) Instructions for assembly, installation, operation, and maintenance of the Goods.

(7) Certified test reports.

(8) Performance curves.

(9) List of spare parts included in the contract.

(b) Documents, as mentioned in Paragraph 1 and respective sub-Paragraphs, shall be tied in two copies each, wrapped in waterproof package sheets, and attached to the shipments. The packing list shall contain the list.

Article 12. APPROVAL OF MANUFACTURING DRAWINGS

In the case where a contract requires approval of the drawings prior to manufacture, the Contracting Party shall submit six(6) copies of detailed manufacturing drawings to the End User for approval within the period designated in the contract.

When the contents of the manufacturing drawings are not in conformance with the contract specifications, request for amendment for the contract specifications shall be submitted to the End User for approval prior to the submission of manufacturing drawings.

Article 13. SUB-CONTRACT

No sub-contract shall be made by the contractor with any party other than those who are described in the contract, as supplier or manufacturer for furnishing Goods contracted, without the written approval of KRC.

Article 14. PAINTING AND PROTECTIVE COATING

(a) If equipment to be furnished requires bright or machined surfaces to insure precision fit, such surfaces shall not be painted but shall be protected against corrosive action by a suitable protective coating.

(b) All other metal surfaces which are not to be normally painted shall be protected in the same manner. Protective coatings shall be of types and formulas which insure adequate protection to the surface, in transit and storage on route to final destination.

(c) All other Goods parts shall receive one coat of high quality paint before assembly and a second coat after assembly. Parts not accessible for painting after final assembly shall receive two coats of paint prior to assembly. No painting shall be performed prior to inspection unless specifically approved by the End User.

Article 15. PACKING AND IDENTIFICATION

(a) Except where otherwise specified in contract, all Goods furnished shall be packed in standard export packing in accordance with the contract number and name of KRC. Such packing must be sufficient to insure safe arrival at the destination, fully covering rough handling, salt spray, open storage, and exposure to salt atmosphere and any other overseas shipping hazard.

If special packing is required in the specifications, a detailed description must be included in the bid.

The packages shall be numbered in sequence to designate the package number and total number of the packages being shipped.

(b) All parts and/or spare parts shipped unattached or separately from the basic equipment, must be legibly identified by tags, labels or inscriptions in indelible ink, strictly in accordance with the reference marks or parts numbers of the assembly drawings as follows. Characters shall be not less than one(l) inch high, unless restricted by the size of the packages. Packages and containers shall be marked on top and on at least two sides.

1. On wood, plywood, veneer, cases, barrels or kegs, all marks shall be applied by stencil with waterproof inks or oil paints, and these marks protected against weathering by clear water-resistant varnish.

2. On metal or metal containers, marks shall be applied with water proof oil paints.

3. When metal tags are used, they must be rustproof. Tin or tin-coated tags and uncoated steel tags are not considered rustproof and must not be used.

4. When paper tags are used, they must be free of rope-stock, possess a minimum tearing resistance, and be double eyelet type fastened at each eyelet. After marks have been applied to the tags, the tags shall be coated with clear varnish.

Article 16. PACKING LIST

①Contents of each shipping package shall be itemized on a detailed list showing the exact weight, extreme outside dimensions (length, width and height) of each container. If all containers are uniform in size and weight, the dimensions and weight of only one may be shown.

②One copy of the detailed packing list shall be enclosed in each package delivered. There shall also be enclosed in one package a master packing list summarizing and identifying each individual package which is part of the shipment. The box number in which the master packing list is contained should be shown on each packing list.

③On barrels, bags, drums or kegs where it is not feasible to place the packing list inside the container, all pertinent information is to be stenciled on the outside and will thus constitute a packing list.

Article 17. MARKING

①Marking shall consist of the following information in sequence and in frame commensurate with the size of the container:

1. Consignee : Korea Railroad Corporation

2. Contract number.

3. End User.

4. Port of discharge.

5. Item number, if applicable, package number in sequence, and quantity per package.

6. Goods description.

7. Net and gross weight, and cubic measurement.

8. Shipper's marks and/or trade marks.

9. Caution marks, if applicable.

10. Other marking required in the contract.

②For delivery of goods, manufacturers, trademark, or government procurement goods shall be indicated by printing, metal stamping, tags, or other methods, dependent upon shapes or nature of goods.

Article 18. INSTRUCTION MANUAL

Whenever applicable, the Contracting Party shall furnish printed instructions relating to installation, proper maintenance and repair, and part lists indicating various parts by name, number and diagram, with each unit of equipment.

Article 19. PATENTS

The Contracting Party shall hold any liability of including loss or costs for or on account of any patented or unpatented inventions, Goods, devices, or appliances manufactured or used in performance of this contract, including their use or disposal by or for KRC.

Article 20. PRICE CONTROL

The Contracting Party shall guarantee that the stated price does not exceed the regular price and that such price is not higher than that charged by other buyers similarly situated. Violation of this clause by the Contracting Party will entitle KRC to rescind the contract and/or to claim a refund for the excessive price paid.

Article 21. PAYMENT

(a) After the contract is made, KRC will apply to an authorized foreign exchange bank in Korea, for issuance of an irrevocable and without recourse; commercial letter of credit. Unless otherwise specified in the contract, the letter of credit shall be established in favor of the supplier in the amount of the total contract value, and shall be maintained for one(1) month after the latest shipping date specified in the letter of credit. Payment shall be made in U.S Dollars or other currency/ies designated in the contract upon presentation of the beneficiary's sighted draft accompanied by the following documents:

1. A full set of clean onboard ocean vessel or charter party Bills of Lading, marked : “freight prepaid” or “freight collect”, as the case may be, to port of destination, consigned to Korea Railroad Corporation

2. Beneficiary's detailed invoice showing Goods description, quantity, unit price, total price, and basis of delivery.

3. Inspection certificates with marking certificate and/or weight certificate.

4. Packing lists, if applicable.

5. Insurance policies or certificates, if applicable.

6. Other documents required, if any.

②Payment for services shall be made upon KRC's instructions, in accordance with the contractual terms and conditions.

③However, payment for Goods and services supplied from within Korea shall be directly paid by KRC

Article 22. SHIPPING READINESS

In the case of a contract made on FOB berth terms, shipping readiness shall be cabled or advised with facsimile or with any other formal letter by the supplier to KRC 20 days prior to loading the cargo, containing such information as contract number, loading port, brief description of Goods to be shipped and invoice amount of shipment, KRC will provide vessels, and give notice 10 days in advance of the vessel's readiness to load. The supplier shall be accountable for demurrage incurred at the loading port due to the supplier's failure to make delivery during the contractual delivery period.

Article 23. LIQUIDATED DAMAGES

①If the Contracting Party fails to make delivery of Goods within the due time, KRC shall, at its discretion, impose the following liquidated damages:

To deduct, for each day of delay in delivery after the date specified, a liquidated damage in the amount of zero point zero seven five percent (0.075%) of the total value of the contract, or, if the contract has been, partially performed within the stipulated time, the total value of the unshipped portion thereof. However, the penalty shall not exceed ten percents(10%) of the contract value. In either case, KRC reserves the right to terminate the contract.

②In case that installation work is required, as stipulated in the bid announcement, all installation work shall be completed at the End User's site within the designated time. The Contracting Party shall submit a time table and dispatching schedule for the period of services as requested in the bid. If the work is not completed within the designated time, the amount calculated by multiplying the rate of liquidated damages stipulated in the contract for one day by the contract amount is imposed as the liquidated damages. In this case the penalty for the delay in delivery [Clause23.①)] shall not be applied. This delay charge shall not apply, if the delay is not the responsibility of the Contracting Party.

③In the case of Goods supplied under the manufacturer's inspection, the liquidated damages shall be calculated on the basis of actual hand-over date of the goods.

Article 24. INSURANCE

In case of a contract made on CIF basis, an insurance policy or certificate shall cover Institute Cargo Clause (A), as designated in the contract for 110% of the invoice value, to be endorsed in blank, expressly state that claims are payable in Korea, in the currency of the contract and also indicate a claim settling agent in Korea. The actual insurance premium shall be paid within the scope of the insurance premiums specified in the contract.

Article 25. DELIVERY

①Delivery shall be effected upon presentation of a clean “onboard ocean vessel” or “party” bill of lading, “freight prepaid” or “freight collect” as the case may be, evidencing shipment in accordance with the contract delivery terms specified in the contract.

②Partial shipments, transshipments and on deck shipments are prohibited, unless otherwise stated in the contract.

Article 26. SHIPPING ADVICE

①Shipping advice shall be cabled or advised by facsimile or by any other formal letter to KRC prior to the onboard date of the Bill of Lading, containing such information as the contract number, loading port, discharging port, brief description of the Goods shipped, name of vessel, ETD(estimated time of departure), ETA(estimated time of arrival), the invoice amount of shipment, and the name of claim settling agent in Korea, if insured.

②In case of air freight; Shipping advice shall be cabled or advised by facsimile or by any other formal letter to KRC before departing, containing such information as the contract number, airport of departure, airport of destination, carrier, name of flight, brief description of the Goods shipped, ETD, ETA, the invoice amount of shipment, and the name of claim settling agent in Korea, if insured.

Article 27. FREIGHT

In case of a contract executed on “freight prepaid” basis, actual freight charges on bill of lading or air waybill documents shall be paid to the Supplier within the scope of the freight charges specified in the contract.

Article 28. SUBMISSION OF TRANSPORT DOCUMENTS

①Supplier shall send each of the following documents in duplicate to the bank designated by KRC and a copy of the same to KRC

1. Charter-Party or liner booking contract, if applicable.

2. Clean onboard ocean vessel Bill of Lading or Air Waybill.

3. Supplier's detailed invoice.

4. Inspection & Marking certificate.

5. Weight certificate, if applicable.

6. Packing list.

7. Insurance policy or certificate, if applicable.

8. Other documents required, if any.

②In case of Goods supplied from within Korea, the Contracting Party shall submit one copy of certificate of acceptance issued by the End User as attached form of APPENDIX I and other documents required in the contract.

Article 29. DEFAULTS

①If a Contracting Party refuses or fails to make deliveries of Goods conforming to the contract specifications within the time specified, or any extension thereof, or to perform faithfully any contractual conditions, or if the amount of liquidated damages reaches that of its performance bond, KRC, without prejudice to other rights of KRC resulting from the breach of contract, may, by written notice, rescind the contract or terminate the right of the Contracting Party to proceed with any or all of the remaining part to be performed. In the event of any such rescission or termination, KRC may, without prejudice to its other rights resulting from the breach of contract, obtain similar Goods elsewhere.

②If rationale for enforcement of liquidated damages occurs pursuant to Article 23 and the amount reaches that of performance bond pursuant to Article 6, contract can be rescinded, terminated or maintained through the following sub-Paragraphs.

1. It is clearly recognized that Contract Party is unlikely to continue the contract implementation: Performance bond confiscated to the National Treasury and contract shall be rescinded or terminated.

2. Other than the sub-Paragraph 1 above, it is recognized that the Contract Party is still capable of implementing the contract and it deserves to be maintained: the Contracting Party shall deposit an additional performance bond in an amount equivalent for which contract has not been completed, and the contract remains valid.

③In addition, the breach of contract will automatically result in the unconditional forfeiture of the Contracting Party’s performance bond without recourse. In any event, KRC reserves the right to recover from any money due or which may become due to the Contracting Party’s for the above mentioned excess costs and/or for any other losses to KRC resulting from the Contracting Party’s default or the breach of contract.

Article 30. FORCE MAJEURE

The Contracting Party shall not be charged with the liquidated damages prescribed in Section 23. LIQUIDATED DAMAGES and/or any excess costs or any other losses to KRC prescribed in Section 29. DEFAULTS, nor shall his performance bond be forfeited.

1. When failure of the Contracting Party in making suitable delivery is due to causes beyond his/her control and which could not reasonably have been anticipated, and were without his/her fault or neglect including, but not restricted to, acts of God or public enemy, acts of the government whether as Contracting Party or sovereign, fires, floods, epidemics, quarantine restrictions, strikes, freight embargoes, and unusually severe weather, and delays and failure of a subcontractor due to any of such causes as above, only in case the subcontractor is specified in the contract in compliance with Section 13. SUB-Contract, and

2. If the Contracting Party notifies KRC in writing of causes of such failure not less than ten(10) days from the beginning thereof or such further period as KRC may grant prior to date of the final settlement of the contract, KRC shall decide the facts and extent of failure, and its decision shall be final and conclusive, subject to the parties hereto holding right to appeal as provided in Article 31.

Article 31. DISPUTE SETTLEMENT

①When legal proceedings are deemed to be necessary for the rights and obligation in connection with this contract, the First Trial Court for the concerned litigation shall be the court chosen by KRC among the competent courts by the law and one of the following courts:

1. Seoul Central District Court;

2. the Competent Court where the head office of KRC belongs.

②However, the dispute may be settled by arbitration in Korea the necessity of court proceedings, in accordance with the International Arbitration Rules of the Korean Commercial Arbitration Board and under the Laws of Korea only if an agreement is made between the parties to the dispute. If cases turn applicable to objection claims under Article 28 of the Act on Contracts to Which the State is a Party, disputes can be settled through arbitration decisions by the State Contract Disputes Conciliation Committee.

③If any method for dispute settlement is determined, when signing a contract, as stipulated in the Article 28-2 of the Act on Contracts to Which the State is a Party, notwithstanding Paragraph ① and ②, settlement shall be proceeded according to the method.

④The Contracting Party shall not suspend the contract execution, during the dispute handling period pursuant to Paragraph ① - ③.

Article 32. REFUNDS

Whenever the bidder receives from his/her supplier a discount, adjustment credit and /or refunds, he/her will notify promptly KRC's Administrator of the amount of money received and the date of receipt and will make refunds thereof to KRC.

Article 33. EXPENSES

All the expenses for the fulfillment of the Contracting Party’s obligations incurred outside Korea, unless expressly stated otherwise in the contract, shall not exceed the contract.

Article 34. GOVERNING LAWS

①Unless otherwise specified in the Provisions, a contract shall be executed under the authority of laws, decrees and Governmental regulations of Republic of the Korea.

②The formation, validity, construction, and the performance of this contract shall be governed by the laws of the Republic of Korea.

Article 35. INTERPRETATION AND TRADE TERMS

①In the event of any disagreement between KRC and the Contracting Party in the interpretation of the provisions of words used in the GP, and the terms and conditions of the contract, the interpretation by KRC shall govern.

②Unless otherwise specified expressly in the contract, it shall be assumed that trade terms are used in accordance with Incoterms (the most recent version as of the bidding announcement date).