July 10, 2020

A legal note on how 3M Pricing from 3M Authorised Distributors works post the COVID19 pandemic

 

*We respect the 3M trademark and have no intention of using the 3M Mark on our website to show a contractual link or business affiliation wth the 3M Company itself.We are however a part of many ongoing 3M procurement transactions for the COVID19 pandemic as a legal team hence these updates are of great interest to our current and prospective client-base.”

 

For Clients (current and prospective) asking for legal clarification on the pricing of 3M Respirators when bought via authorised 3M distributors

Memorandum on 3M Pricing for Potential 3M Respirator Sourcing HealthCare Sector Clients

22 June 2020

 

This information is being given out in the utmost good will and intentions for the general community of 3M PPE purchasers around the world especially health facilities and their procurement teams,

A number of our dedicated 3M Team of marketing agents, facilitators and even direct potential 3M clients have reached out to us complaining that we are not giving out prices and perhaps this is a marketing trick we are using or something underhanded is on the way. Such remarks are a solemn reminder of how fraud has brainwashed us to reject the actual legal facts and the position on 3M Respirator purchases via Authorized 3M distributors.Furthermore as a law firm with integrity, such cheap and base marketing tactics are below our calibre as the guardian of the contemporary society’s legal interests.

Please also refer to an excerpt from the 3M TERMS and CONDITIONS, which form the pith and substance of the general SPA a Buyer will sign with the 3M Authorized distributor

 

·      Pricing, Freight, Payment, Shipping, Returns

  1. Product prices are as listed in the applicable 3M price pages or in 3M’s electronic order systems as of the date 3M processes Customer’s Order.  For Orders specifying future-dated shipments, 3M have the sole discretion to charge the price in effect on the date of the shipment.  Standard payment terms are net 30 days from the 3M-invoice date, unless a different period is stated on the invoice.  Customer may not make or take any deduction, set-off, or other adjustment without 3M’s prior written approval.  Order quantities must meet stated minimums for Products.  ……

 

  1. If 3M pays freight on the Order 3M may designate the means of transportation and routing.  If Customer requires alternative means of shipment, Customer will pay any resulting costs.  Lead times are as stated by 3M and Products may be placed on backorder at 3M’s discretion.  Where Product availability is limited for any reason, 3M may fill orders or otherwise allocate Products in any manner it deems appropriate.  Under no circumstances will 3M be liable for failure to ship, or for Customer’s failure to receive, Products by a certain date.

 

  • 3M may require prepayment of any Order.  Any credit extended to Customer is done at 3M’s discretion and subject to 3M credit requirements.  Customer must keep its account current at all times.  3M may withhold shipments, payments, or other benefits, and/or assess late fees and interest on past due amounts until the account balance is current.  Returns are subject to 3M’s applicable return goods policy and require advance 3M authorization.”

 

The above excerpt is extremely clear in what it says.3M Respirator pricing depends on the date of the order and will apply ‘as of the date 3M processes Customer’s Order’.Therefore we can give you the prices on the 3M website for the factory purchase, which is only allowed for distributors and no more. And we are all aware that due to the strange set of market conditions following COVID, distributors prices for these respirators will vary for all regions around the world including CIF rates for that date if 3M is going to be arranging the shipping.

As mentioned above, COVID19, 3M has also issued a Distribution Policy in a Letter to 3M distributors (attached to this PDF) that there will be no direct sales but through 3M Authorized Distributors who have been asked to sell as per the normal supply/demand/urgency indicators and not gouge prices to the best of their efforts. People are advised for sake of saving their own money and investments and to prevent unnecessary headaches to buy from 3M Authorized Agents only.

This 3M-distributor letter dated 26th of May 2020 has two important aspects in it:

·       Communicating product availability. Relatedly, because product availability and lead times will vary, we require that 3M Authorized Distributors not make promises about future respirator availability or access, unless referring to product that you currently have in your stock today.

 

·       Buying from 3M. We are committed to doing all we can to help combat counterfeiting of respiratory products falsely claimed to be from 3M. As part of that commitment, we require that 3M Authorized Distributors purchase and resell only legitimate 3M products. This means that we expect you to acquire 3M products only from 3M or 3M Authorized Wholesalers here in the U.S., not from any other reseller or in any other country.

 

Both these excerpts are actually extremely relevant to the way we work and lend credence to most of the matters we have been trying to explain to the general public especially whenever we have a prospective PPE client being mail boxed by such attractive offers.

3M became a popular brand due to its one of a kind respirators and the preference given to them by healthcare providers around the world even before the COVID19 Pandemic.Post COVID19 it became the Golden product of 3M and its demand shot up considerably. Unfortunately this popularity has brought in vendors and agents claiming access to ridiculous amounts of 3M’s popular N95 respirator face masks and they are continuing to do this around the world to get the attention of buyers with claims that are outrageous.Which reminds us to add here, that a genuine 3M Distributor, whether working alone or via facilitators never asks for upfront payment until you have verified the goods. Our hardworking pro-bono legal team of Josh and Mak International in Association with Van der Berg & Associates is in constant communication with agents, buyers and sellers as the times continue to change and needs continue to adapt. It has taken us half a year to set together a chain of credible buyers, suppliers, and manufacturing facilities that can put 3M Masks and PPE into the hands of emergency medical teams, essential workers and health systems that need it most.

Our recommendation to businesses looking to acquire PPE is to simply add up the facts and not to pay anything in advance to ‘book’ a 3M Respirator stock.

 

Where Prices are being given upfront it may be a Red flag for possible Fraud:

 

It may be true that a person in another country has ‘access’ to 50 million masks, but if they are giving you a price and claiming to have stock you may have missed 2-3 technicalities there.

  • Many countries have banned export of PPE. How are these people reselling/exporting the masks to your country?
  • This person may be a tout or small time agent of a small-scale distributor who can only handle small mask quantities.
  • If the stock is already in a warehouse which means it has been bought, this also means that as it is outside 3M’s domain, and in private hands, it may be tampered, damaged and well counterfeited If the seller is not showing you a 3M receipt for such ‘Stock’ many things are wrong with this sale. For all you know these may be expired respirators. Such an incidence has happened with many purchasers in the past and they had no basis of claim and legal action against a small time reseller who had the ‘stock on ground’.
  • If such a stock actually makes it to your country’s import customs and 3M cannot verify that the 3Ms are coming from their official distribution channel, you may just have opened yourself up to a flood of legal liability. If the stock is expired then you can expect criminal proceedings too.

For this reason, bulk quantities of over 1 Million units are safe to buy from a 3M authorized distributor and not from a private LOT or seller, in another country or even a close city in your company’s home country. Counterfeiters and scammers will always find new ways to scam you even when they have the so-called Masks. We have seen instances where the same LOT of masks were counterfeited with the exam same serial numbers and never caught. In any other case there was a genuine 100,000 respirators on the ‘Ground’ for which the scamming seller took payment for the ‘stock on ground’ from 5 different buyers and ran off.

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