Suppose John Doe is a beet farmer in Scranton, Pennsylvania. Usually, he grows about 10,000 beets a year. XYZ Company is a cement company and offers to buy 10,000 bushels from John in two weeks. As John wants to make sure the deal takes place, he adds a take or payment clause in the sales contract that requires XYZ companies to either buy all the beets as agreed or pay John $150,000. One of the fundamental principles of Directive 2009/73/EC[8] is in particular the possibility of allowing third parties access to the natural gas transmission system, i.e. any supplier may have access to it. In this context, derogations from this rule may be requested where another natural gas company that already has access to the network demonstrates that it is experiencing economic and financial difficulties as a result of the take or pay clause it has received[9]. The energy sector often uses OTC or payment rules, as energy supply requires a significant investment for overhead costs in gas, crude oil or other resources. Without this way of ensuring that they will have some return on their investment, they would have no incentive to spend capital in advance on production. This means that the determination of harm must take into account the entire economic situation of the victim, i.e. the negative and positive consequences of the adverse event[14]. Arrangements made or paid for in a contract should facilitate financially predictable outcomes, particularly in the case of debt.
If a supplier needs a loan to finance the production of a buyer`s order, the lender may not be willing to offer the necessary funds without a provision to take or pay in the contract. This provision ensures that the supplier will be able to pay the loan as intended. (d) According to the above calculation, the seller has readjusted the price of the willing or payment quantities according to the price that was ultimately paid to its supplier. The rules of taking or payment are usually between companies with their suppliers, which require the purchasing company to take over an agreed delivery of goods from the supplier before a given date, at the risk of paying a fine to the supplier if they do not do so. This type of agreement benefits the supplier by reducing the risk of losing money for the capital spent to make the product they want to sell. It benefits the buyer by allowing him to demand a lower negotiated price, since he takes on part of the supplier`s risk. This can be an overall net benefit to the economy, as it facilitates transactions that might not otherwise take place, and the resulting profits from trade, through a better allocation of risk between buyers and suppliers. Since take or pay contracts typically include long-term contracts, they are vulnerable to future events that the agreement does not cover. These events can be more political, geological, commercial or more. It may happen that the contract is no longer feasible for either party after the event. Thus, the buyer or seller can terminate the contract. Over-the-counter or payment contracts usually contain clauses that define the circumstances in which they are renegotiated.
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