Information for Sellers & Introducers re trial consignments of AU Metal
The Company is a buyer of AU Dore Bars and Nuggets but NOT dust. We offer what we believe to be the best possible financial terms other than are available from a direct refinery metals account. This facility is focused on the smaller to medium-sized mine or concession and is designed to provide maximum financial return combined with a total security protocol, utilizing a European Refinery, to eliminate risk to either side. The financial return to sellers is based on LBMA less 4% discount.
This briefing note outlines how we complete business in relation to trial or first consignments ONLY. We hold numerous Metals Account with Refineries in different locations but purchase ALL trial/ first consignments ex our Refinery in Germany following smelt and assay and subject to contract. European Refineries are extremely tightly regulated, and Sellers are actively encouraged to send a representative to accompany any trial consignment and see the process work for themselves. Our trial protocol is based on the following:
• The Seller agrees to a contract with us issued by our Head Office Legal Department in Melbourne.
• Seller provides all required information reference chains of supply KYC/ Compliance where applicable and we obtain Refinery approval.
• delivers the trial consignment direct to the Buyers Refinery in Germany via either Frankfurt or Leipzig airports.
• A Refinery accredited Customs Clearance Agent clears the consignment through German Customs at either airport with all charges to the buyer company account.
• A multinational security/ logistics company – with details identified to the seller – is instructed to provide armored security transport from the airport to the identified Refinery. Cost to the buyer company account.
• The Refinery, upon arrival of the consignment, carries out preliminary testing to confirm that the consignment is as stated in the documentation. Cost to the buyer company account.
• The Refinery smelt and assay the consignment and provide a copy assay report to Buyer and Seller. This is normally completed within 24/ 48 hours of arrival. Cost to the buyer company account.
• Based on the Refinery assay report the buyer company makes a settlement to the sellers nominated bank account as defined within the contract. Settlement on trial/ first consignments is normally based on a discount structure of London Bullion Market Association (LBMA) less 4% (Four percent) plus any commissions - normally circa two to two and one-half percent - which are required to be approved by the buyer company. The settlement is normally completed within 24 hours of receipt of the Refinery report. Daily LBMA second fix/closing prices can be checked via www.lbma.org.uk (see the top of the opening page).
• Trial / first consignments are normally between five and twenty-five kilos only at the seller’s option. Larger volumes are welcome on subsequent deliveries as per contractual agreement.
• Chain of supply KYC (Know Your Customer)/ Compliance “clearance” is insisted upon by Refineries, Banks and Logistical Security Companies. However, assuming a consignment to be of non-criminal origin and not involving child labor, then the process is very straightforward. We have expertise in the correct presentation from most AU producing countries including those historically regarded as problematic. For example, re DRC specifically, we have a situation where our Refinery will work constructively with us to achieve a positive outcome where there may be issues that need to be addressed.
• We do NOT provide a financial instrument on trial / first consignments. This is due to the historically very high level of "drop-outs/ non-performance" by sellers even when a contract has been executed. We are no longer willing to block funds in relation to a financial instrument on any trial consignment. For this reason, our CEO, a respected senior International Lawyer, has agreed and put in place this tried and tested procedure which offers total security to both Sellers and the buyer company alike. This protocol will not be varied for a trial consignment under ANY circumstances. Likewise, we do not fund export charges on trial consignments. A formal Legal Undertaking regarding payment is available and is issued personally by our CEO, in his capacity as a practicing Lawyer, together with confirmation of his status from the Legal Services Board and can be attached to the contract as an Addendum on request.
• To "protect the integrity" of the arrangement it should be noted that at no time does the buyer company have access to or handle the consignment. Our focus is to establish and promote long term business relationships with reliable suppliers. This protocol offers total security to both sides and is committed to in detail within all our contracts.
• Financial Instruments ARE available on subsequent consignments based on a price/discount structure negotiated for individual proposals. Likewise, we are open to considering the pre-funding of export charges where mutually agreed procedures can be put in place. It is possible that such arrangements may involve a requirement for a second trial consignment to replicate procedures through the logistics company that sellers intend to use for ongoing deliveries.
• Whilst Sellers representatives are welcome to travel with their consignment it must be clearly understood that admission to the Refinery is at the discretion of the Refinery Management only. Any representative wishing to accompany a consignment should provide a certified copy passport plus certified local Police Clearance Certificate in good time for us to liaise with the Refinery reference admission.
• In response to the, frequently, lengthy-time it has taken to process visa applications we also suggest that if a Seller has a Europe based family member, friend or business associate who they feel can take their place at our German Refinery then we shall be pleased to facilitate the necessary arrangements with the Refinery on the Sellers behalf. Otherwise, we shall provide full assistance to the application process. We have in place already with many German Embassies in Africa formalized confirmations that our visa application support letters are sufficient for proof of "the purpose of visit".
• It is the Sellers' responsibility to ensure that any traveling representative has the necessary Business Visa for Germany plus any other relevant documentation to include healthcare insurance, please. It is unwise to attempt to travel on a Tourist Visa with even a small hand-carried consignment of AU as ALL metal MUST be declared at German Customs.
• We shall normally be able to arrange for a seller to be met at Frankfurt or Leipzig by our representative and driven to the Refinery - a journey of some two-plus hours or one hour respectively. Additional information re travel/ hotels etc. will be available after the execution of the contract.
Reference commissions please be aware that any of our approved representatives involved in the introduction MUST be included in any commission arrangement.
* TRADING COMPANIES / INTRODUCERS PLEASE NOTE THAT FULL TRANSPARENCY IS NOW DEMANDED BY BOTH REFINERIES AND THE BANKING SECTOR RE ALL-NEW SUPPLIERS. IT IS THEREFORE OBVIOUSLY NOW A VERY SERIOUS ISSUE FOR ANY TRADING COMPANY. WE ARE ALWAYS WILLING TO PUT IN PLACE FORMAL AGREEMENTS TO PROTECT YOUR FINANCIAL INTERESTS IN RELATION TO END SUPPLIERS. WE DO NOT CIRCUMVENT UNDER ANY CIRCUMSTANCES. IN THE CASE OF TRADING COMPANIES, WE ARE ALWAYS WILLING TO DISCUSS THE STRUCTURE OF ANY PROPOSED ARRANGEMENT AND OFFER AS MUCH FLEXIBILITY AS POSSIBLE BUT FULL TRANSPARENCY IS NOW UNAVOIDABLE.
* COMMISSIONS TO INTRODUCERS ARE NORMALLY PAID THROUGH A TRUSTEE ARRANGEMENT AND LAST FOR THE LIFE OF ANY CONTRACT, TO INCLUDE ANY EXTENSIONS, FOR A MINIMUM PERIOD OF FIVE YEARS SUBJECT TO PERFORMANCE OF THE RELEVANT CONTRACT / SUPPLIER.
* THIS COMPANY ACTIVELY SUPPORTS "THE TEN PRINCIPALS OF THE UNITED NATIONS GLOBAL COMPACT PROGRAMME" WWW.UNGLOBALCOMPACT.ORG IN RELATION TO ALL TRANSACTIONS IN SPECIFIED REGIONS.
• Information for Sellers & Introducers re trial consignments of AU Metal
• Corona impact on procedures for trials
• Trial Consignment Protocol for delivery to German Refinery via Freight Forwarding
• Download the complete file here