Conditions of Purchase
FERRA ENGINEERING PTY LTD Conditions of Purchase
Ferra Group has a policy of working with key suppliers to develop long term mutually beneficial supply relationships.
This document defines the basic requirements that must be met by supplier organisations for the supply and delivery of goods and/or services
to Ferra entities including Ferra Engineering Pty Ltd and Ferra Aerospace Inc.
Ferra has established high performance expectations both within the group and for external suppliers, rewarding supplier superior performance with
ongoing business opportunities. Ferra maintains metrics of supplier’s performance related to onetime delivery and product conformity.
The Supplier accepts these conditions through accepeptance of a contract or purchase order which references this document, or through commencement of any related work or activities. Unless stated by a Ferra representative in writing these conditions are deemed to have been accepted in their entirety without modification.
Ferra’s Order number must be quoted on all documents and correspondence relating to the Purchase Order. A Purchase Order number must accompany verbal orders and a copy of that purchase order is to be received by the Supplier within 48 hrs. In the conditions of Contract:
“Ferra” means Ferra Engineering Pty Ltd, established 1992 or it’s Global subsidiaries;
Contract means the contract between Ferra and the Supplier for the purchase of Supplies on the terms of the Conditions of Purchase;
Goods means the articles, goods, materials or parts thereof to be supplied under the Contract;
Services means the services to be performed under the Contract;
Supplier means the person named on the purchase order who is to supply the goods/services to Ferra, and where the supplier includes more than one person, those persons jointly and severally; and
Supplies mean the Goods and/or Services.
Purchase Order means a written order for Supplies placed by Ferra on the Supplier; such an order will become a Contract upon the Supplier’s written (including e-mail) acknowledgement thereof as envisaged in clause 3 below.
Purchase orders must be acknowledged and written confirmation received by Ferra within 24 hours of the Supplier receiving their copy of the Purchase Order and Contract. Any queries must be raised before proceeding to execute the order. Acceptance of an Order by the Seller or the performance thereof shall be deemed to be an acceptance of these conditions notwithstanding that the sales order or other documentation of the Seller may contain a condition similar in terms to these conditions.
The time of delivery stated is of the essence of the order. Ferra requires 100% on-time delivery. The date specified for delivery is the required delivery date at Ferra’s premises (FOB destination), this includes all relevant paperwork requested on the order. When the Supplier expects difficulties in production or sourcing of materials or when circumstances beyond the Supplier’s control arise which may affect timely delivery to the required quality the Supplier shall inform Ferra in writing (including e-mail) without delay.
Ferra shall not be liable to accept or pay for quantities in excess of those set out in the order and the call-up schedule if any, attached to the Purchase Order, or otherwise requested by Ferra in writing and accepted by the Supplier. Ferra may return to the Supplier any quantities in excess at the Supplier’s expense.
All deliveries must be accompanied by the Suppliers delivery documentation and material certification. All documentation must refer to the Ferra’s part number (where applicable), part description, order number and quantity delivered. A Certificate of Conformity certifying that the seller’s Quality assurance department has accepted the product/parts must accompany the supplies where applicable. Failure to comply may result in rejection of the delivery.
7 Packing and Shipment
All goods must be suitably packed to ensure arrival in good order and condition. Unless otherwise expressly agreed in writing, the cost of delivery to the Ferra purchasing organization including boxing, packing, crating, cartage and storage shall be borne by the supplier.
Ferra’s policy is one of full cost recovery. Ferra demands a control
system to ensure:
That all goods covered by Ferra’s order shall conform to the specifications, drawings, samples, symbols or other descriptions provided by Ferra in or referred to in the Purchase Order and shall
be merchantable of good material and workmanship, and free from defects.
That all goods covered by the Ferra’s order and made in accordance with the Supplier’s designs, drawings, specifications or other descriptions shall be suitable for the purpose intended,
merchantable, of good material and workmanship. Supplies are warranted to be free from defects in materials provided by the Supplier and in workmanship for a period of 12 months from the
date of delivery. Any defect identified within the warranty period must be reported to the supplier in writing within 30 days of its discovery. The supplier will rectify
any defect in the supplies by repair or replacement of defective goods or by rerendering of defective services without any charge for labour or materials. All other warranties, express or implied, are hereby excluded to the fullest extent permitted by law. The warranty is the exclusive remedy of Ferra, whether in tort or otherwise, in respect of defective Supplies.
9 Provision of Materials
Materials provided by Ferra free of charge shall remain Ferra’s property. Such materials shall only be applied for the purpose intended by Ferra’s order.
10 Non-conforming Product
Ferra must be notified in writing where deliverable product (including process or service that has potentially affected deliverable product) is non conforming. A concession will be issued if approved by Ferra. The concession number must be referenced on all delivery documentation, the product and package(s) identified as non-conforming. Seller shall provide written notification to Ferra when a non-conformance is determined to exist, or is suspected to exist, on product already delivered to Ferra. Written notification shall include:
Affected process/s or product number/s and name/s,
Description of the nonconforming condition and the affected engineering requirement (should be & Is condition),
Quantities, dates and purchase order numbers of the delivered,and
Suspect/affected serial numbers or date codes where applicable. Notification must occur within three business days of knowing all above information. However for Aerospace purchase orders if the condition creates a possible flight safety risk, submit all available information immediately. These conditions shall be flowed down by the supplier to its direct suppliers and the sub-tier supply chain.
11 Special Requirements
Special requirements, critical items and key characteristics identified through the PO or referenced documents, shall be observed by the supplier and flowed down to sub tier suppliers as applicable.
12 Specification, Design and Scope Changes
Ferra may at any time require the Supplier to implement changes to the specifications or design of the goods or to the scope of the Supplies covered by the Contract, including (but not limited to) work related to inspection, testing or quality control. Such changes shall be reflected in an amendment to the Contract agreed to by the parties in writing (including e-
mail). While Ferra will endeavour to discuss any such agreed changes with the Supplier as early as practical, the Supplier will promptly implement such changes.
13 Termination For Breach or Insolvency
Ferra may terminate the Purchase Order or Contract in whole or in part when the Supplier:
Fails to deliver the goods and provide the services at the time and place specified in the Purchase order and Contract;
Becomes bankrupt or insolvent, or is unable to complete the Purchase Order or Contract; or
Fails to Remedy a breach within the time specified in the notice of breach.
14 Termination for Convenience
Ferra may at any time give notice in writing to the Supplier to terminate the Contract or any part without cause. In such an event Ferra shall compensate the Supplier for all recurrent and non-recurrent costs and expenses incurred under the Contract up to the date of termination with a reasonable allowance for profit on that part of the Contract performed up to the date of termination.
The manufacture and provision of supplies shall be carried out in accordance with the quality assurance requirements stated on the order. The seller shall comply with all quality requirements and procedures Ferra specifies in the Purchase Order, as accepted. Any certification requirements stated in the purchase order must be current at time of shipping. The Seller shall promptly notify the Ferra Supplier Quality Representative that supports your facility of any changes in the management representative with assigned responsibility and authority for the quality
system. The Seller shall promptly notify the Ferra SQR that supports your facility of any changes in certification or approval status that affects the seller’s ability to meet the conditions of purchase.The seller shall flow down all relevant quality requirements to its direct suppliers and the sub-tier supply chain.
16 Right of Access / Audits
Ferra’s representative, its customers & Regulatory authorities shall have the right of access to inspect and evaluate seller’s facilitie’s systems, data, equipment, personnel and all completed articles
manufactured to fulfil a Ferra purchase order. At all reasonable times for any purpose in connection with the performance by the Supplier of the order and to establish whether the Supplier is capable of meeting and or maintaining specified requirements. The Supplier shall secure the same rights of access to the premises of its subcontractors and flow down these requirements to all sub tier suppliers.
17 Drawings, Tools and Equipment
All tools, gauges, jigs, dies and other equipment, drawings, blueprints, specifications, programs, samples and other data (“Materials”) provided to the Supplier by Ferra, and any materials which have been or are to be purchased or manufactured by the Supplier for the purpose of manufacturing the goods specified in an order, or for which Ferra has paid or will pay in full or in part, shall be and remain the property of Ferra and shall be deemed to be confidential to Ferra and shall not be disclosed or used by the Supplier or its agents or sub-contractors, except as required by Ferra’s order. Upon completion, cancellation or other termination of work under the order, the Supplier shall return all materials together with all copies thereof, and shall thereafter not disclose or make any further use either directly or indirectly of any information derived therefrom without Ferra’s prior written consent. Designs of tools, equipment dies etc. shall be subject to approval by Ferra prior to commencement of manufacture thereof.
2. Where any work associated with the carrying out of an order is to be undertaken by any agent or subcontractor of the Supplier, Ferra shall have the right to approve or disapprove any such agent or subcontractor, and the Supplier shall undertake to ensure that any such agent or sub-contractor shall be contractually bound for Ferra’s benefit to observe the terms of sub-clause (1) of this clause.
3. All materials held at the Supplier’s premises or at the premises of any agent or sub-contractor of the Supplier shall be at the
4. Supplier’s risk and shall be insured by the Supplier at the Supplier’s expense for current replacement value in respect or loss or damage for any reason whatsoever.
Payment Terms are Strictly 30 days EFT from the end of the month in which the goods and or services are received. A Ferra vendor application form is to be completed and provided to Ferra with the relevant EFT details. Basic conditions for timely payment is that the invoice is correctly addressed, quotes Ferra’s Purchase Order number and includes all other information that is necessary to Ferra. Ferra may withhold payment for any goods or services until Ferra receives evidence, in such form and detail as Ferra requires, of the absence of any liens, encumbrances and claims on such goods or services.
The Supplier agrees that it will defend, indemnify and hold harmless Ferra, its officers, employees, and agents (those indemnified) from and against any liability, claims, demands, damages, costs or expenses (including, without limitation, reasonable attorney and other professional fees and disbursements) arising from or in connection with any third party claims or demands to recover for personal injury or death or damage to or loss of property or in respect of defects in the Supplies, all to the extent caused by the negligence or wilful misconduct of the Supplier. The Supplier will, however, not be responsible for consequential or indirect losses suffered by Ferra.
The supplier is required, at its cost, to effect and maintain throughout the term and any additional period the company deems necessary, each of the following insurances (where required by applicable law or as reasonably requested by Ferra), General and Product Liability Insurance, Workers Compensation and Employees Liability Insurance, Supplier’s Plant and Equipment, Goods in Transit, Motor Vehicle/Automobile Third Party Liability Insurance, Professional Indemnity Insurance, Marine Insurance and Aviation Insurance, in relation to risks or occurrences arising, or which may arise, out of the performance of the Contract.
The Supplier shall:
Not use technical and/or proprietary information and the features on tools, gauges, jigs, dies and other equipment, drawings, blueprints, specifications, programs, samples and other data (“Materials”) provided to the Supplier except for the purpose of supplying to Ferra.
Not grant third parties access to Purchase Order information without prior written consent of Ferra.
Return a signed copy of the Non-Disclosure Agreement to Ferra within 48 hours of receiving the document
22 Force Majeure
A party will not be liable for any delay or failure to perform any of its obligations under the Contract (other than an obligation to pay money) if as soon as possible after the beginning of the Force Majeure affecting the ability of the Party to perform any of its obligations under the Contract, it gives notice to the other party that complies with the following. A notice
Specify the obligations the party cannot perform;
Fully describe the Force Majeure
Estimate the time during which the Force Majeure will continue; and
Specify the measures proposed to be adopted to remedy or abate Force Majeure
23 Intellectual Property
Where Ferra furnishes the design of the supplies any copyright or design rights shall belong to Ferra.
24 Applicable Law and Jurisdiction
The laws of the Commonwealth of Australia and the State of Queensland shall govern these Conditions. The parties hereto submit to the jurisdiction of the Queensland Courts
25 Documentation Storage & Retention
Seller shall maintain and have available on a timely basis, quality records traceable to the conformance of product/ part numbers delivered to Ferra. Seller shall make such records available to regulatory authorities and Ferra’s authorised representatives. Seller shall retain such records for calendar year + 10 years from date of shipment for all product/part numbers under each applicable order unless otherwise stated on the order. Documents which excede the retention requirement period may be disposed of. Disposition shall render the documents unreadable and unrecoverable.
28 Counterfeit Parts
It is a condition of supply to the purchasing organization that the supplier plan implemement and control processes, appropriate to the supplier’s organization and the product, for the prevention of counterfeit or suspect counterfeit part/s inclusion in delivered products. Controls against the delivery of counterfeit parts shall be in compliance with a recognised industry standard for counterfeit parts. The above conditions are applicable to all delivered items including electronic parts, mechanical parts and raw materials.
If suspect/counterfeit materiel is furnished under this purchase agreement, such items shall be impounded. The seller/supplier shall promptly replace
such items with items acceptable to Ferra and the seller/supplier may be liable for all costs relating to impoundment, removal, and replacement. Ferra may turn such items over to Authority Having Jurisdiction for investigation and reserves the right to withhold payment for the suspect items pending results of the investigation.
The supplier shall ensure the awareness of individuals within their organization of: Their contribution to product or service conformity, their contribution to product safety, and the importance of ethical behaviour.
30 Flow Down Requirements
The supplier shall flow down (as applicable) all requirements stated in these conditions of purchase, and any additional requirements stated in the PO or referenced documents, to their external providers.