General Purchase Conditions of
Harlow Engineering T/A Smiths Harlow (“SH”)
Effective 14th July 2020
1.1 All SH orders shall be governed exclusively by the special conditions set forth therein and these (subordinated) general purchase conditions. The Supplier’s general terms and conditions of business shall not apply, even if SH has not expressly objected to them in each individual case or the Supplier has declared that it is willing to deliver only subject to its own terms and conditions.
1.2 Contracts for deliveries and services (and also purchase orders and acceptance), delivery call-offs as well as amendments and supplements shall be valid only if in writing. Electronic transfer of data shall be acceptable if mutually agreed upon. Oral declarations or agreements must be confirmed in writing by SH.
1.3 Purchase orders not accepted by the Supplier within two (2) weeks may be cancelled by SH.
2. Scope of the Contract
2.1 The scope of deliveries and services to be provided by the Supplier shall be determined by the specifications, drawings, design schemes, films, samples and descriptions submitted at the time the contract is concluded and/or – in the absence of such documents – by the information contained in the Supplier’s quotations and brochures. The Supplier shall provide the deliveries and services using suitable approved materials. The deliveries and services shall comply with all relevant statutory/official provisions. The Supplier shall provide for a suitable quality assurance and control system and comply with any quality specifications expressly called out in the purchase order.
2.2 SH will accept only the quantities ordered. The delivery of excess or smaller quantities, as well as partial deliveries, shall be subject to SH’s prior written consent.
2.3 The Supplier shall make sure, as appropriate, that the deliveries and services provided comply with environmental, accident prevention and other health and safety regulations, as well as the safety engineering regulations and all legal requirements applicable in the United Kingdom and/or the European Union. Furthermore, the Supplier shall notify SH of any special, not generally known handling and disposal requirements that may apply to any delivery or service.
2.4 Supplier shall comply with the Aerospace Industries Association of America (AIA) Global Principles of Ethics in the Aerospace & Defense Industry, available for review here: http://asd-europe.org/business-ethics
3. Changes to the Scope of the Contract
3.1 If, in the course of performance of the contract, deviations from the agreed original scope of the contract are deemed necessary or appropriate, the Supplier shall notify SH without delay stating the cost increases or reductions resulting from the change. SH will then inform the Supplier of its decision regarding the proposed change. If the change is approved by SH, the compensation agreed upon with the Supplier will automatically be increased or reduced in accordance with the change proposal submitted as per sentence 1 of this clause. The notification of consent shall only be legally binding upon SH if made out in writing.
3.2 The Supplier shall also notify SH without delay of any intended changes in the composition of the materials being processed or in the design as compared with deliveries or services of the same kind previously provided to SH. Any such changes are subject to SH’s written consent.
4. Furnishing of Material and other items
4.1 Materials and other items of any kind furnished by SH shall remain the sole property of SH, to the extent that such materials and items are processed or transformed by the Supplier, SH shall be deemed to be the sole manufacturer within that meaning. If such materials or items are joined or blended with other materials or items in a manner that the result may be regarded primarily as the Supplier’s property, SH shall be entitled to co-ownership pro rata of the value of the materials or items, and the Supplier shall retain custody of the property co-owned by SH. Insofar as items are developed or manufactured by the Supplier with substantial participation by SH (tests etc) or are manufactured by the Supplier to SH specifications or are paid for in full by SH, they may be used only for purposes pertaining to the SH purchase order. If such items are SH’s property, they shall be returned to SH without delay and ‘carriage paid’ at SH’s request. The Supplier shall bear all risks of loss of or damage to the materials and items furnished by SH, unless the Supplier cannot be held liable for loss or damage.
4.2 The Supplier undertakes to carry out any maintenance or inspection that may be required on the items furnished by SH and to take out adequate insurance coverage for them – especially for transportation to and from third parties – at Supplier’s own cost, and to provide evidence thereof if so requested by SH.
5.1 The parties undertake to treat as confidential all commercial and technical details that become known to them in the course of their business relations.
5.2 Technical documents, drawings, models, templates, samples and similar objects made available by SH shall not be placed at the disposal of or otherwise made accessible to unauthorised third parties. The duplication/reproduction of such objects is permissible only within the limits of internal requirements and the terms of copyright. Authorised third parties, e.g. subcontractors, shall be committed to confidentiality in a similar manner.
5.3 In references or publications, the Supplier may not use SH’s name or trademark without SH’s prior written approval
6.1 The placement of subcontracts is subject to SH’s prior written consent
7. Delivery Dates/Shipment/Pricing
7.1 Agreed delivery dates shall be binding. The date of receipt at SH shall determine whether deliveries have been made in due time.
7.2 As soon as the Supplier becomes aware that specified delivery dates cannot be adhered to, the Supplier undertakes to notify SH without delay and in writing of such delay stating the reasons and the expected duration. If the Supplier fails to inform SH of delays for any reason whatsoever, SH shall be entitled – without prejudice to the penalty claim as per clause 7.3 – to claim damages.
7.3 In the event of default on the part of the Supplier, the Supplier shall be obliged to pay a penalty in the amount of 1.0% of the order value for each week commenced, up to a maximum of 10% of the order value. The right to claim further damages remains unaffected. SH may claim the penalty also in the event SH reserves the right to claim penalties within one (1) month after acceptance of the last delivery or service due under the purchase order.
7.4 The agreed deadlines for the provision of deliveries and services by the Supplier may be postponed by SH by up to four (4) months maximum if SH’s envisaged demand of such deliveries/services is delayed by strikes or interruptions of operations of another kind. This does not give rise to any claims on the part of the Supplier. If the delay in SH’s demand is attributable to force majeure and if its duration exceeds four (4) months, either party may terminate the contract in whole or in part. The same applies to delays in delivery attributable to a substantiated case of force majeure, if the duration of the delay exceeds one (1) month.
7.5 Each shipment shall be accompanied by a delivery note and a Certificate of Conformity, where relevant, and attached at a conspicuous location. The delivery note shall state the SH’s purchase order number and item number, date of despatch, type of packaging, identification of the goods, quantity and weight, as appropriate, as well as the recipient’s address.
7.6 The place of performance for deliveries and services in SH’s head office.
7.7 Otherwise SH shall be entitled to all statutory claims for delays in delivery.
8.1 The commencement of an agreed period for payment shall depend on the agreed delivery date. The payment term shall, however, not commence before the goods/service and an invoice as per clause 8.2 has been received by SH.
8.2 Invoices shall state SH’s purchase order number and item number as well as the date of despatch, identification of the goods, quantity and all other data required. The original invoice that constitutes SH’s obligation to pay shall be sent separately through the post. If the invoice does not comply with the above requirements, SH shall be entitled to refuse payment.
8.3 Normally payment shall be affected by BACS or cheque. The date on which this is sent shall be decisive for determining whether payment has been effected within the period allowed. Payment can also be affected by other means, but in no event cash on delivery. VAT treatment and all other tax obligations shall be governed by the applicable tax laws.
8.4 SH’s normal payment terms are 60 days from receipt of invoice or goods/service whichever is the later.
9. Purchase Order Quality Terms and Conditions
Unless otherwise stated on the purchase order the following terms and conditions apply.
9.1 The Supplier shall retain records in accordance with the Suppliers internal requirements* and SH’s customer requirements** where applicable. Where there is no SH’s customer specified on the purchase order the minimum retention period for records shall be five (5) years.
9.2 The requirements for approval of product procedures, processes and equipment shall be in accordance with the Suppliers internal requirements* and SH’s customer requirements** where applicable.
9.3 The requirements for qualification of personnel shall be in accordance with the Suppliers internal requirements* and SH’s customer requirements** where applicable.
9.4 The quality management system requirements shall be in accordance with ISO9001, where the aerospace volume of the Supplier’s business exceeds 50% then the requirements shall also be in accordance with AS9100, AS9110 or AS9120 as applicable. In addition, the quality management system requirements shall be in accordance with SH’s customer requirements** where applicable.
9.5 The Supplier is required to obtain and work to the latest issue of all applicable technical data. The name or other positive of specifications, drawings, process requirements, inspection instructions and other relevant technical data as applicable shall be specified on the purchase order. Where the technical data is specified on a SH or SH’s customer drawing (component definition, condition of supply etc) the purchase order will normally state the drawing identification only, the Supplier is responsible to comply with all the applicable technical data listed on the drawing.
9.6 The requirements for test, examination, inspection and related instructions shall be in accordance with the Suppliers internal requirements* and SH’s customer requirements** where applicable.
9.7 The requirements for test specimens (e.g. production method, number, storage conditions) for inspection, investigation or auditing shall be in accordance with the Suppliers internal requirements* and SH’s customer requirements** where applicable.
9.8 The requirements for notifications of non-conforming product shall be in accordance with the Suppliers internal requirements* and SH’s customer requirements** where applicable and the following:
Non-conforming product already shipped – The Supplier must notify SH promptly of non-conforming product or processes discovered that may affect the product or processes discovered that may affect the product already delivered. Notification may be by any documented means (email, fax, etc) giving the details of all products affected.
Non-conformance contained at the Supplier – Unless the Supplier can rework the product to drawing requirements, the supplier must notify SH promptly of non-
conforming processes discovered that affect the product. Notification may be by any documented means (email, fax etc) giving the details of all products affected.
The Supplier shall obtain SH’s documented approval for any non-conforming products/material that cannot be fully reworked to conform to drawing/specification
9.9 The Supplier shall notify SH by any documented means prior to making any changes to product and/or process definition. The Supplier shall also obtain SH’s
or SH’s customer** approval prior to implementing any changes as applicable.
9.10 The Supplier shall allow right of access by SH, SH’s customer, and regulatory authorities to all facilities involved in the order and to all applicable records.
9.11 The Supplier shall flow down to all sub-tier Suppliers the applicable requirements in the purchase order, including key characteristics where required.
9.12 The Supplier will only source product from the OEM customer approved sources, where this applies, for the service/product supplied to SH. In addition, full traceability is required to be maintained for the supplied product as per the relevant approval. It is incumbent on the supplier to be vigilant on the providence of their sources of supply and to ensure no unapproved product or potential counterfeit items are allowed to enter the supply chain.
*The Supplier’s internal requirements shall be conforming to ISO9001, where the aerospace volume of the Supplier’s business exceeds 50% then the requirements shall also be conforming to AS9100, AS9110 or AS9120 as applicable.
** The SH’s customer requirements document(s) will be shown on the purchase order where applicable.
10. Warranty/Claims based on Defects/Liability
10.1 SH will notify the Supplier in writing of any defects in the deliveries as well as handling damage and damage to the packaging as soon as such defects or damage can be detected in the ordinary course of business. Reasonable periods for notification of defects are one (1) month after delivery for obvious defects and 14 workdays after detection for hidden defects.
10.2 If the Supplier fails through its own fault to rectify the defects within the reasonable period of time allowed by SH, if the Supplier wrongfully refuses to rectify the defects, if attempts at rectification have not been successful or if SH cannot be reasonably expected to accept rectification, particularly in the event of impending danger, SH may, without prejudice to its legal claims vis-à-vis the Supplier, take the necessary measures at the Supplier’s cost and risk or have the defects rectified by third parties. SH shall be entitled to set off the costs incurred for rectification of defects or claim its right of retention. This shall also apply in the event that claims and counter-claims arise from different business transactions/contracts.
10.3 The Supplier shall be liable for any damage which is associated with the deliveries and services to be provided and attributable to its own fault or negligence. This also includes damage occurring during performance of the contract. The Supplier shall be liable for its own fault and that of sub Suppliers and persons employed in the performance of the contract.
11. Property Rights
11.1 The Supplier warrants that the delivery, use and operation of the contractual items as well as the services rendered do not infringe upon third party property rights, in particular patents or licenses.
11.2 The Supplier shall indemnify and hold SH and SH’s customers harmless from any third-party claims based on the violation of property rights and shall bear all costs incurred by SH in connection with such claims.
12. Assignment of Claims/Set-offs
12.1 Without SH’s prior written consent, the Supplier shall not be entitled to assign any claims under the contract to third parties or have them collected by third parties; this applies only in the event that extended reservation of title has been agreed upon between the Supplier and its sub-tier suppliers.
12.2 SH reserves the right of set off against the Supplier’s claims. A final statement of the claims set off or approval by the Supplier shall not be required.
13. Right of Withdrawal from the Contract/Termination
13.1 If one of the parties fails to meet its payment obligations or if insolvency proceedings over its assets are initiated or if a petition for settlement in court or out of court has been filed, the other party shall be entitled – after having allowed a reasonable period of grace – to withdraw from the part of the contract that has not been performed or to terminate the contract. With respect to the right of withdrawal of termination agreed at the time the purchase order is placed the following shall apply; any other costs incurred up to the termination of the contract will be reimbursed. The Supplier shall provide evidence of the facts on which its claims are based.
14. Partial Invalidity
14.1 If a contract provision is or becomes invalid this does not affect the legal validity of the remaining contract. Both parties undertake to replace the invalid provision by a valid one which as closely as possible reflects the intent of the invalid provision.
15. Law and Jurisdiction
15.1 This Agreement and any action, claim, dispute or other proceedings arising out of or in connection with it shall be governed by and construed in accordance with English law and the Parties hereby irrevocably and unconditionally submit to the exclusive jurisdiction of the English courts.