Foreign business risks

Credit risk

Inability and/or unwillingness to pay on the part of debtors and guarantors.

For example:
The buyer cannot or will not pay.

Country risk (political risk)

Risk that political events or measures may prevent the performance of contractual obligations.

For example:
War, rebellion, revolution, annexation, civil unrest, embargo, boycott, government debt, protectionism.

Country risk (transfer risk)

Impossibility of converting and transferring the amount paid in the national currency.

For example:
Payment ban, exchange controls, moratorium, consolidation, transfer ban.

Manufacturing and performance risk

Importer cancels or changes the order unilaterally, or importer is unable to perform the contractual obligations.

For example:
Due to production problems, financial difficulties of the producer, late delivery of goods or missing delivery.

Delivery risk

Contractual delivery is impossible or cannot be reasonably expected due to a subsequent increase in the credit and/or country risk, or due to lack of transportation.

For example:
No ship available.

Transport risk (insurance)

Goods lost or damaged in transit.

Currency risk

Appreciation and depreciation of a currency or fluctuations in the CHF/foreign currency exchange rate.

For example:
In the case of completion of a contract or invoicing in a foreign currency.

Technical risk

The product does not conform to contractual specifications or the machine supplied does not function correctly.

For example:
Manufacturing defect, defective assembly, poor quality.

Settlement risk

The key settlement risks:
Non-compliance with deadlines, non-observance of national regulations, incomplete delivery, customs problems, missing or incorrect documentation.

Mailing risk

If a documentary credit or guarantee is valid and/or payable abroad, there is a danger than the documents will arrive too late or will be lost. Result: the payment is delayed or may even not be effected.