Procurement refers to an enterprise that obtains products or services from the supply market as enterprise resources under certain conditions to ensure the normal development of enterprise production and business activities. The principle that enterprises uphold in the procurement process is generally to get the production materials required by the production of enterprises at the lowest possible price. Procurement is one of the core links of enterprise management and an important part of reducing operating costs. This article will focus on analyzing the legal risks in the procurement process and how to deal with them.

Supplier lacks qualification or performance capability

The lack of qualification of the supplier may lead to the invalidity of the procurement contract, and the lack of performance ability of the supplier may lead to the difficulty of performing the procurement contract after signing. Therefore, before the signing of the procurement contract, the purchasing enterprise should review the supplier's qualification and performance ability, such as checking the other party's business license, tax registration certificate, license certificate, agency certificate and other information, to ensure that the supplier is a legitimate entity, and the economic activities engaged by the entity are within its business scope and license scope. Procurement contract negotiators, signatories strictly speaking should be the supplier's legal representative, other personnel to participate in negotiations or signing need to show power of attorney, in practice, this aspect is often difficult to standardize as a textbook, but if the negotiator, signatory is not authorized to represent, after the supplier did not ratify, there will be trouble. In addition, the purchaser can also make a comprehensive judgment on the economic strength, credit status and market sales scale of the supplier through public information, special channel information and other ways to ensure that the supplier has the ability to perform the agreement.

The quality of the goods provided by the supplier is not up to the requirements

If the quality of the goods provided by the supplier does not meet the quality standards required by the purchasing enterprise or the requirements of the procurement contract, there will be corresponding performance risks and production and operation risks. The main reasons leading to this risk are: there are problems in the raw materials of the supplier, resulting in the processed products not reaching the quality standard; The supplier does not identify the unqualified products, resulting in the unqualified products mixed into the warehouse.

When the purchasing enterprise concludes the procurement contract with the supplier, it shall clearly agree on the quality standard of the subject matter in the agreement. The so-called quality standard generally includes enterprise standard, industry standard, national standard, foreign advanced standard, etc. The purchasing enterprise can choose and apply according to the actual situation. If conditions permit, it can also seal the sample for reference; If the supplier is a foreign supplier, it shall clearly agree on which country's quality standard shall be used for acceptance, the applicable law and the competent judicial authority when the dispute arises; If both parties have special requirements on quality, it should also be clearly stated in the contract. At the same time, we should pay attention to the quality guarantee period of the product and specify the starting point; If a more detailed agreement is needed, it can be clearly stated that if a quality dispute arises, the parties agree to submit which institution for appraisal, and how to pay the appraisal fee in advance and bear it.

In addition, according to the provisions of Article 610 of the Civil Code Contracts, if the quality of the products delivered by the seller is substandard, the buyer may refuse to accept or terminate the contract. According to Article 621 of the Civil Code of Contracts, the buyer shall, within a reasonable period of time, notify the seller of any non-conformity of the quantity or quality of the subject matter. Enterprises need to be aware of this requirement.

The supplier is late in delivering the goods

If the supplier does not fulfill the delivery obligation in strict accordance with the contract, the delivery of the goods will be delayed, which will cause losses to the purchasing enterprise. Therefore, the purchasing enterprise shall clearly agree on the mode of delivery, mode of transportation, place of delivery, time of delivery, and commitment of transportation costs in the procurement contract. The purchasing enterprise shall also stipulate the liability for breach of contract as clearly as possible in the procurement contract to provide a basis for future claims of the purchasing enterprise. It should be reminded that the contract details in this respect are very important and very prone to disputes. For example, regarding the delivery location, it is necessary to pay attention to the confusion of place names (some place names overlap in China), station names confusion (the same name, the same name, the north and south stations and the new and old stations are not divided) and other problems, the company needs to establish a contract review, management and education system for this, and hire professionals (such as specialized legal affairs or external lawyers) to review and implement this.

A dispute arose over the price and payment method

The price is one of the most important contents of the purchase contract. The purchase of a single goods, the price is fixed, the price is more clear, generally will not produce disputes. If the purchase of a variety of goods or a long-term sale of goods, the price is more complex, once the agreement is unclear, it is easy to produce disputes. Therefore, the purchase contract should clearly specify the product unit price, measurement standards, quantity, product accessories, etc. If it is necessary to provide product technical services, it must be clearly agreed that if the attached obligation cannot be fulfilled, the performance of the main obligation will lose meaning (such as the product software does not provide updates or the update charges a huge amount of money, resulting in the loss of value of the product, etc.). For foreign-related contracts, the type of currency and foreign exchange settlement standards should also be clearly defined to prevent differences. The payment method should also be agreed clearly, such as cash payment, check payment, etc., if the use of remittance, acceptance settlement, remittance fees, discount fees and other payment methods cost by who should also be clearly agreed. It also needs to be reminded that the contract agreement is only more perfect, not the most perfect, the contract version used within the company can not be achieved overnight, the same millennium, not only need professionals to review the implementation, but also keep pace with The Times, real-time update.