SECTION D - TRADING DEBTS

(a) Is it usual in this country for suppliers of goods or services to supply those goods or services to corporation on credit?

Our answer is in the affirmative. Subject to the terms and conditions reached between the parties and providing of any security (if any), goods and servaices are supplied to corporations on credit.

(b) If so, what would be the average credit period of time? Usually one month. However, where usance Letter of Credits are provided, it can be upto (90) days or even more.

(c) Is it possible and/or usual in this country for a supplier to require security over property of the corporation for the supply of goods or services?

It is possible but not practised. However, for long term arrangements, security by way of bank guarantee, or Letters of Credit is provided.

(d) If so, is the form of supply known as 'retention of title' practised and recognised in this country and is it enforced?

Such form of supply similar to 'retention of title' is not really practiced (with certain exceptions), but is recognised under the Pakistan Sale of Goods Act, 1930 which provides in Section 25 that in a contract for the sale of specific goods or where goods are subsequently appropriated to the contract, the seller may by the terms of the contract or appropriation, reserve the right of disposal of the goods until certain conditions are fulfilled. In such cases, notwithstanding the delivery of the goods to a buyer, or to a carrier or other bailee for the purposes of transmission to the buyer, the property in the goods does not pass to the buyer until the conditions imposed by the seller are fulfilled.