Purchase Order Terms & Conditions

The Terms and Conditions (“this Terms and Conditions”), which shall form an integral part of and as reference to the Purchase Order (“PO”) is made and entered into by CNOOC SES Ltd. (“PURCHASER”) and your company (“SUPPLIER”).

PURCHASER and SUPPLIER are individually hereinafter referred to as a “Party” and collectively hereinafter referred to as the “Parties”.

1. SPECIFICATION

SUPPLIER shall carefully examine the specification of the goods to be required including all of this Terms and Conditions, PO and matters that can in any way affect PO or its cost (the “Goods”).

2. GOODS DELIVERY

2.1 Delivery of the Goods is addressed to PURCHASER’s representative at delivery point as stated in PO. Partial quantity item delivery of the Goods made by SUPPLIER shall not be accepted.

2.2 SUPPLIER shall submit the Delivery Order/Delivery Ticket (“DO/DT”) at the time of the Goods delivery and be signed by PURCHASER’s representative, as a proof of delivery. PURCHASER’s representative will subsequently issue the Material Receiving Report (“MRR”) granted to SUPPLIER. The signed DO/DT and MRR are the required documents for invoicing, which refer to the respective PO.

2.3 PURCHASER shall only pay for the quantity of the Goods that have been ordered and delivered to PURCHASER as shown in MRR.

2.4 SUPPLIER shall ensure that the Goods including its packing are fully inspected prior delivery to PURCHASER. Delivery of the Goods with total weight of twenty (20) Kilograms or more shall be plastic strapped and banding by using hardwood pallets reversible deck and double wing type designed for sling pallet. Size: 1220MM x 1220MM x 150MM.

2.5 Every car of SUPPLIER entering PURCHASER’s warehouse at Tanjung Priok must prove valid passed emission test certificate. Each of SUPPLIER’s personnel shall be equipped with Personal Protective Equipment such as hand gloves, safety helmet and safety shoes.

3. FOREIGN PURCHASES

3.1 For PO with the delivery terms of Cost, Insurance and Freight (“CIF”) Tanjung Priok Port, CIF Soekarno-Hatta International Airport, Delivery Duty Unpaid (“DDU”) CNOOC SES Ltd. Warehouse – Kalijapat Tanjung Priok Jakarta, SUPPLIER is required to furnish three (3) sets of the original shipping documents namely Bill of Lading (“BL”) or Air Way Bill (“AWB”), proforma invoice, packing list, etc. to Procurement Department CNOOC SES Ltd., Indonesia Stock Exchange Building, Tower 1, 22nd Floor, Jl. Jend. Sudirman Kav.52, PO. Box 2759, Jakarta, Indonesia.

Delivery of the above documents must be carried out altogether at the same time by SUPPLIER, as soon as they are issued, but not later than three (3) days upon the date of BL for shipments from Asian ports and seven (7) days upon the date of BL for shipments from USA and European ports, in the meantime not later than three (3) days upon the date of AWB for shipments from Asian, USA or European ports. In the event of exceeding the aforementioned period, all costs or expenses incurred shall be at SUPPLIER’s own responsibility.

3.2 All shipping documents and shipping packages (cases, cartons, crates, bundles, etc.) must show and be marked with CNOOC SES Ltd., PO. Box 2759, Jakarta, Indonesia as the consignee. Packing is consistent with weight, type of item(s) and mode of transportation in conformance with practice of the trade.

3.3 Marking and tagging of each item of the Goods shall be marked directly or tagged (spare parts, small items) with PO and item numbers. Failure to comply with will cause rejection on delivery.

4. TERMS OF PAYMENT

4.1 SUPPLIER shall submit directly to Finance Department CNOOC SES Ltd., Indonesia Stock Exchange Building, Tower 1, 21st Floor, Jl. Jend. Sudirman Kav. 52, P.O. Box 2759, Jakarta, Indonesia, an invoice bearing reference to PO not later than the twenty-fifth (25th) day of each month in duplicate for compensation earned by SUPPLIER. Each invoice shall be accompanied by original of the signed DO/DT and original MRR. For the Goods, which will be imported by SUPPLIER, the invoice must be supplemented by BL or AWB, proforma invoice, packing list, etc.

4.2 The currency of the invoice shall be paid in accordance with PO. Any payment due to SUPPLIER shall be made through COMPANY’s account and CONTRACTOR’s account at a Public Bank or a branch of Foreign Bank located in Republic Indonesia’s territory within thirty (30) days of receipt of the invoice by PURCHASER. In the event no payment has been made by PURCHASER within such thirty (30) days, SUPPLIER may question in writing addressed to Finance Department with carbon copy (“CC”) to Procurement Department.

5. TAXES AND CERTIFICATION

5.1 SUPPLIER shall be responsible at its own expense for all taxes including but not limited to charges, contributions, duties, stamp-duty and fees imposed upon PO in accordance with applicable law and Indonesian tax authority directives.

Any Indonesian Value Added Tax and Sales tax on Luxury Goods shall be paid in accordance with applicable law and Indonesian tax authority directives.

5.2 SUPPLIER shall be responsible to obtain at its own expense all certifications from manufacturer or authorized institutions including but not limited to licenses and other approvals for performance of PO.

6. PERFORMANCE BOND
For PO with price more than US$20,000, and in order to guarantee the performance of the PO and this Terms and Conditions, SUPPLIER shall prior to collecting and signing PO, submit to PURCHASER the original Performance Bond from a bank in Indonesia or a foreign bank which is having a branch located in Jakarta, in a sum of five percent (5%) of the PO price in the same currency which is valid as of the facsimile of intent date until ninety (90) days upon the promised delivery date of the Goods.

PURCHASER shall have the right to cash-in the Performance Bond, in the event SUPPLIER fails to fulfill PO due to incapability to deliver the Goods that have been ordered as stated in Article 16.

7. WARRANTIES
SUPPLIER warrants to PURCHASER that the Goods shall be suitable for the service intended, the quality and quantity specified, and the specifications or drawings sample and other descriptions contained in PO.

SUPPLIER shall guarantee that the ordered Goods are genuine, brand new and truly produced by the designated manufacturer by SUPPLIER in connection with the quotation. Any Goods not complying with PO and this Terms and Conditions including but not limited to fake, re-use and recondition of the Goods shall be returned to SUPPLIER for replacement at no cost to PURCHASER. The fake, re-use and recondition of such Goods shall not release the late delivery penalty.

8. INDEMNITEES
8.1 The employees, agents and property of each Party shall be the responsibility of the Party itself, and the Party shall release the other Party harmless from and against any and all losses, unless any gross negligence of the other Party or any breach of PO and this Terms and Conditions.

8.2 Each Party shall be responsible to its negligence arising out of third party losses.

8.3 Neither PURCHASER nor SUPPLIER shall be responsible to the other for loss of profits or similar consequential damages.

9. INDEPENDENT SUPPLIER
SUPPLIER shall at all times be an independent SUPPLIER and shall have no power to bind PURCHASER to any other party in any way.

10. COMPLIANCE WITH LAW AND GOVERNING LAW

Either SUPPLIER or PO and this Terms and Conditions shall be subject to and governed by the BPMIGAS Procedure Guidelines No. 007/PTK/VI/2004 dated June 9, 2004 concerning Supply Chain Management and other laws of the Republic of Indonesia.
11. ARBITRATION
All disputes or claims shall be decided amicably by the Parties. If those cannot be settled amicably, it shall be binding and finally settled by the Indonesian National Board of Arbitration.

12. PENALTY
A penalty of the late delivered Goods as stated on PO will be levied to SUPPLIER zero point one percent (0.1%) of the late delivered Goods price for each day during the first fifty (50) days as of the promised delivery date.

13. PRICE REDUCTION
Upon the days elapsed as stated in Article 12, SUPPLIER shall reduce the Goods price amounting to zero point one hundred twenty five percent (0.125%) of the late delivered Goods price for each day from the fifty-first (51st) day until ninetieth (90th) day.

14. CHANGE ORDER NOTICE
PURCHASER may by written notice make any change order, including additions to or deletion from the previous of total quantity of item(s), or the specification or drawings. If any of such change notice affects the amount due or the time of the Goods delivery, then equitable adjustment shall be made.

15. FORCE MAJEURE
Force Majeure means acts of God such as fires, floods, typhoon, tsunami, earthquake or others including rebellion and war.

In the event of Force Majeure, the Party affected by such event shall notify the other Party within five (5) days, at the latest, after the first day of the Force Majeure occurred. In the event such period is exceeded, the other Party has the right to refuse Force Majeure as the reason for the failure of or delay in the performance of PO by the Party affected.

16. CANCELLATION
PURCHASER shall have the right to cancel PO or item(s) of undelivered Goods and/or apply sanction on infringement conducted by SUPPLIER in accordance with the category set forth in the provision of Article 10, if SUPPLIER:

- fails to fulfill PO due to incapability to deliver the Goods that have been ordered; or

- is late to deliver Goods as stated in PO more than fifty (50) days as of the promised delivery date under the provision of Article 12.

In the event the Goods late delivery reach more than ninety (90) days, hence such PO will automatically cancel without prior notification from PURCHASER and SUPPLIER shall have no right to take any claim or demand for payment whatsoever under or pursuant to this Terms and Conditions.

PURCHASER may, at any time by written notice, cancel PO or item(s) of undelivered Goods in accordance with Articles 14 and 15.

Articles 1266 and 1267 of the Indonesian Civil Code are hereby expressly and irrevocably waived by the Parties with respect to any cancellation effected herein.
17. INSPECTION
PURCHASER and its authorized representatives shall have the right to inspect and test the Goods including but not limited to its quality control at anytime during manufacturing period, prior to shipment or upon arrival at the delivery point.

The Goods shall not be deemed accepted until the final inspection at the delivery point. The making or failure to make any inspection of and test, or payment for acceptance of the Goods, shall in no way impair PURCHASER’s right to reject non-conforming Goods or request to SUPPLIER for any remedy.

SUPPLIER, at its own expense shall have obligation to re-pack, equipped with its own packing materials and equipment the delivered and inspected Goods as per PURCHASER prevailing procedure upon final inspection by PURCHASER.

18. INFRINGEMENT
SUPPLIER warrants that the Goods shall be free of any claim of infringement of any patents, copyrights, trademarks, trade names or industrial designs or the like, and shall hold harmless and defend PURCHASER from such claims and legal proceedings including its costs.

19. HEALTH, SAFETY AND ENVIRONMENT (“HSE”)

During the delivery of the Goods in PURCHASER's field/office, SUPPLIER shall be at its own cost the subject to the applicable PURCHASER’s HSE regulations.

20. COMPLETE PO AND TERMS AND CONDITIONS
PO and this Terms and Conditions contain the entire understanding between the Parties and supersede all prior negotiations, correspondence, and any agreement either orally or in writing. No alleged modification shall be binding unless it is set out in writing and signed by the Parties.

21. ASSIGNMENT
Any assignment of PO in whole without the prior written consent of PURCHASER shall be automatically void.

22. WAIVER
Each of the rights and obligations contained in PO and this Terms and Conditions shall be deemed to be distinct. None of the said provisions shall be considered waived by PURCHASER unless such waiver is given in writing by PURCHASER. No any delay or omission on PURCHASER in exercising PO and this Terms and Conditions shall constitute a waiver of such right.

23. AUTHORITATIVE LANGUAGE
PURCHASER and SUPPLIER agree that in the event that there is any inconsistency or contradiction between the Indonesian text and English text in this Terms and Conditions, the Indonesian text shall govern and prevail.

24. NOTICES
All notices for either PURCHASER or SUPPLIER shall be sufficient in all respect when delivered personally or sent by mail or facsimile to PURCHASER with the address as stated in PO.