The €28,298.81 EXW Bill: How a Recent Court Case Highlights Key Exposure Points for Purchasers
When shipped goods are rejected because they aren’t of the right quality, who pays? On the 21st of May 2025, Rotterdam Court finally delivered a verdict on a cross-border trade dispute – providing valuable insights into jurisdiction, contracts, and trade term exposure.
In this article, we explore how the Incoterm affected the judgement and how the right checks could have prevented a large bill.
Contents:
A Summary of the Dispute
In November 2022, a Dutch Buyer ordered clementines from the Supplier in Spain – purchased under the Ex-Works Incoterm (EXW) for €11.30 each, €23,865.60 in total. These clementines were destined for a Norwegian Importer. These parties are referred to going forwards as the Seller, Buyer, and Importer.
The goods were inspected by the Buyer’s partner in Breda, The Netherlands, before being delivered to Norway – three days after the collection in Spain.
During the inspection at Breda, a query was raised regarding the colouration, but the delivery to Norway proceeded anyway. The Buyer claims this went ahead on the assurance from the Seller via phone call that the fruit would ripen in transit.
The shipment was stopped at Importer’s premises on arrival, and then rejected four days later after the produce still did not meet the Importer’s standards.
There were nine days from collection of the goods in Spain to rejection in Norway. The timeline is as follows:
- 26th November: The goods collected in Spain.
- 29th November: The goods are inspected in Breda, Netherlands. The quality control report states the colouration as “fair”.
- 1st December: The goods arrive with the Norwegian Importer and are stopped because of quality concerns.
- 5th December: The Importer confirms rejection of the clementines.
The Buyer then sold the clementines on the open market for €5,128.59, only €2.43 per box – €18,737.01 less than the EXW price, before considering transport and other costs.
The Buyer claimed that the Seller should only be paid €5,128.59 of the €23,865.60 invoice due to the goods being uncompliant with their usual purpose of reselling to a supermarket for end consumption.
The Seller insisted the goods were compliant with EU regulations and the full invoice value was due. The Buyer suspended payment of the Seller’s invoice, awaiting settlement of the dispute.
The Legal Complications and Ruling
As the Seller is in Spain and the Buyer is based in the Netherlands, this case has international character. As such, Regulation (EU) No. 1215/2012 of the European Parliament (Brussels I Recast) applies, with Article 4 of this Regulation granting Rotterdam Court jurisdiction to hear the claim of the Seller, who is the plaintiff.
The Court found that the United Nations Convention on Contracts for the International Sale of Goods (the Vienna Sales Convention) applies to this contract, with the parties agreeing that Dutch supplementary law applies to issues not within the Vienna Sales Convention.
Due to this ruling and the use of the EXW incoterm, the Buyer’s claim of nonconformity no longer applies.
Under the EXW incoterm, the seller must make the goods available for collection at the premises. Any complaints for nonconformity must be reported within a reasonable timeframe and within the shortest period possible. The Buyer had not inspected the clementines at the time of collection on the 26th of November.
Furthermore, the contract between the Seller and the Buyer makes no reference to an agreement for clementines which ripen in transit. Therefore, the clementines were accepted in their condition upon collection at the Seller’s premises.
Due to the rejection of the nonconformity claim, the Buyer:
- Cannot use their lower sale price to claim a reduction, and must pay the full purchase invoice value of €23,865.60.
- Is unable to suspend its payment obligation, meaning that collection and interest fees of €3,770.32 are awarded to the Seller.
- Pay the extrajudicial costs of €1,013.66.
- Pay the Seller’s legal costs of €4,777.82
Total to pay: €33,427.40
Total loss after selling the goods: €28,298.81
The Key Lessons Procurement and Supply Chain Officers Can Learn Here
This case provides three clear insights for trading across borders:
#1: When Buying EXW, the Risk is Yours
Under the EXW incoterm, the supplier has to make the goods available for collection – that’s it. The risk is yours from the moment you move them, including loading them onto the vehicle.
If there are any issues with the quality of the goods, then this must be reported within a reasonable time period. Ideally, before the goods are handled at all.
Where possible, arrange for an inspection before loading.
If you’d like advice on creating a standard operating procedure (SOP) for arranging third-party inspection of goods, Customs Support Group can help you. Contact us for assistance.
#2: Your Window to Claim Shrinks Rapidly
Even if your goods are not purchased under the EXW term, you cannot assume that you can make a complaint about the quality of the goods days later.
In this case, the risk was transferred to the Buyer on collection. However, there is also the inspection in the Netherlands to consider. The goods were inspected and then forwarded to another country despite there being a query on the quality.
If this incoterm had been C&F to Breda, then the onward delivery could be interpreted as assumed acceptance of the goods’ condition if there was no complaint at the time of inspection. If there is a formal, documented complaint, the seller can then confirm whether they are accepting the potential for a rejection later or not.
Make sure that any issues are reported as soon as possible and agree who is taking the risk if transit continues. Always document correspondence with suppliers in writing.
If you need help understanding when risk transfers to you for each Incoterm, or would like to create SOPs for inspecting fresh goods, CSG is here for you. Contact us for assistance.
#3: Be Clear on Expectations in Contracts, Especially for Perishables
In this case, the was potential for the goods to ripen in transit. However, there was no such assumption outlined in the contract. Despite the claim that advice was received via phone call that the goods would ripen in transit, there is no contractual obligation for this.
Where possible, include assumptions in your contracts and document any advice on specific shipments in writing. Do not rely on phone calls to confirm advice or information which might be required later.
CSG provides expert guidance with reviewing contracts for risk or balancing contractual assumptions with incoterm practicality. Contact us for more information.
How Customs Support Group Helps You Reduce Exposure to Costs
When it comes to international customs and trade, CSG is here to help you manage unnecessary risk and avoid expensive mistakes.
Here’s how we can help you:
- Incoterm and Contract Guidance: Protect your business from legal, operational, and financial risk with the right incoterm and contractual terms.
- International Customs Clearance: Whether you need Intrastat declarations within the EU or import/export clearance within the EU, UK, CH, or NO – we’re here for you.
- Fresh Inspection (Amsterdam only): If you’re bringing in perishables or cold goods through Schiphol Airport, Customs Support Fresh is here to give you quick and comprehensive inspection on-site.
- Compliance Training: Get expert support with training staff on incoterms, creating SOPs for claims, and performing trade audits so that you can pre-empt risk.
- Valuation Adjustment: If goods are downgraded, we may be able to help you reduce the declared customs value and subsequent import duty/tax obligations.
Contact us today to get started.
*This article summarises a publicly available judgment from the Rotterdam Court dated 21 May 2025: ECLI:NL:RBROT:2025:6164 – Case C/10/683122 HA ZA 24-643
