Cotton importers challenged to use arbitration body<\/p>\n
JAKARTA (JP): An associate director of the Britain-based
\nLiverpool Cotton Association (LCA) yesterday challenged
\nIndonesian cotton importers to file complaints against foreign
\nexporters with the LCA's arbitration body.<\/p>\n
Husein Aminuddin, also the chairman of the Indonesian
\nSpinners' Association, denied yesterday that LCA's arbitration
\nprocedures were one-sided and lengthy.<\/p>\n
\"Who, among these claimants, has ever gone to the LCA for
\narbitration? They should try first and only then give their
\nopinions,\" Aminuddin told The Jakarta Post.<\/p>\n
He acknowledged there were set procedures before a claim could
\nbe legally taken to arbitration.<\/p>\n
In cases on quality claims, the procedures include producing
\nreports from a laboratory, approved by the two parties in
\ndispute; both parties jointly appointing an independent surveyor
\nto examine the validity of the claims; and both parties jointly
\ndeciding whether the samples taken for laboratory testing should
\nbe done to part (at least 10 percent) of a shipment, or to the
\nentire shipment.<\/p>\n
\"Cotton importers that want to file a claim against exporters
\nmust do so according to the rules and conditions stipulated in
\nthe contract signed by both parties,\" he said.<\/p>\n
Earlier this year, a number of textile companies claimed they
\nhad received imports of defective cotton from the United States.<\/p>\n
The biggest company hit, PT Argo Manunggal, said some 4,700
\nbales of its California-Arizona cotton were infected by cavitoma,
\na type of fungus which was reportedly found in cotton shipments
\nfrom October to December last year.<\/p>\n
Almost all the affected companies said they were reluctant to
\ngo to the LCA for arbitration, saying the body would disadvantage
\nthem. They considered arbitration was a last resort.<\/p>\n
Of the companies, PT Putra Sejati Spinning Mills has been the
\nonly one to consider taking a claim to arbitration at the LCA. As
\nof July, however, no progress on Putra Sejati's case had been
\nreported.<\/p>\n
No agreement<\/p>\n
Meanwhile, sources say that Argo Manunggal has failed to reach
\nan amicable agreement with one of its U.S.-based suppliers.<\/p>\n
Aminuddin said yesterday that if laboratory tests -- conducted
\nunder the rules stipulated by the LCA -- proved that cotton
\nimports were defective, the importers would be able to sue the
\nexporters.<\/p>\n
\"But you need to get test reports. Do that, and you have a
\nsolid case in your hands,\" he said.<\/p>\n
Aminuddin also spoke on the need to include fiber strength as
\na factor that should be considered in cotton trade.<\/p>\n
\"Advances in technology, which have resulted in high-speed
\nspinning and weaving machines, require the utilization of cotton
\nwhich has a high degree of fiber strength,\" he said.<\/p>\n
Aminuddin said the LCA should pay attention to this issue as
\nit could easily result in disputes between cotton sellers and
\nbuyers. So far, he said, the LCA had no mechanism to resolve
\ndisputes over fiber strength at arbitration.<\/p>\n
Fiber strength issues are currently facing spinning mills in
\nSoutheast Asia, South Korea, Hong Kong and Taiwan.<\/p>\n
Cotton consumption in Southeast Asia has increased rapidly in
\nthe last couple of years. It will make up 4.4 million bales of
\ntotal world consumption of 86.6 million bales in 1996\/1997. (pwn)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/cotton-importers-challenged-to-use-arbitration-body-1447893297",
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