Case Study - Mumbo Ltd V Inter-Shop Ltd
Mumbo Ltd is a leading importer and distributor in Mauritius. The company imports a wide variety of products from South Africa, including coffee, margarine, wine, chocolate, biscuits, fresh fruits and vegetables. The company imports its products from a South African exporter called Inter-shop Ltd.
The contract between the 2 companies is on CIF basis and it was agreed that Inter-Shop would ship 10 containers of goods to Mauritius every month. Since the pandemic, Inter-Shop has been charging Mumbo Ltd, up to 30% more than pre-pandemic prices. All the products are exported under normal WTO rules of trade. Mumbo Ltd noticed that, due to the disruptions in freight services, the containers are sometimes coming through different freight forwarders and the price variance seems to be related to availability of freight.
Mumbo Ltd is looking for ways to reduce its costs and has secured your services to advise on whether its current CIF contract is indeed the best approach. Mumbo Ltd would also like to know whether it could benefit from the SADC Free Trade Agreement (FTA) which Mauritius has signed with South Africa, and if so, how could it access the benefits of the FTA