Important advice to all facilitators/prospects
It is imperative to understand that we have an exhaustive due diligence process in place and we expect the same from all the prospects who wish to work with us. We do not work with brokers who are just mail forwarders and are not direct to end buyers & end sellers.
Please read the following carefully as this will decide if Cangem can work with you or not :
We do not work with a daisy chain of brokers. This means if you approach Cangem, you should be direct with your principal (end buyer or end seller) and willing to go through our due diligence and KYC. NO exceptions shall be made what so ever. Being new in business in not bad but you should do your homework. We receive tons of emails where individuals claim to be "close" to the seller/buyer, but over the years we have understood clearly that being "close" is not being direct. We are not here to teach business to every individual that emails us, please do your homework. It is always difficult to work when there is no transparency.
Even the most genuine deals fall apart because of brokers. Many do not know the proper procedure and do not do the required due diligence. Almost 99% of the times, brokers do not trust each other and do not want to disclose vital information and are afraid of circumvention. They do not retain the services of a corporate lawyer or trade consultant. Cangem Global will stay away from this disaster at all costs because our reputation is most important to us. We start everything with an in house due diligence.
Read more about due diligence here
NCNDA / IMFPA
The first thing any amateur broker will pop up is that we have to sign the NCNDA (Non Circumvention Non Disclosure Agreement) and MFPA (Master Fee Protection Agreement). First of all, almost all the NCNDAs and IMFPAs floating in the market are FAKE and not endorsed by ICC. You ought to understand that we do not have any problem with signing NCNDA but it has to be genuine. We only utilize the genuine ICC publication 769 E ( ICC Model Contract ) that can be purchased here.
Any other NCND you see with the ICC logo and mostly titled ICC 400/500/600 is fake. Read the official warning from ICC here. Then there are those who claim to be mandates and then ask for an NCNDA; beware of these individuals and companies. Real mandates never fears circumvention as they are protected by the company who extended the mandate to them.
Secondly, Cangem cannot just sign the NCND with every individual and company that comes along claiming to be direct with their principal. Be ready with detailed information about your company, website, corporate profile, registered office address, working phone numbers to begin with. Not all but most emails from gmail, yahoo, hotmail etc will be purged.
Read more about the NCNDAs here
Proper Commodity Knowledge
We will expect you to have proper knowledge about the commodity you inquire. If you lack basic knowledge about the commodity and how it is traded, don't expect us to teach you. We receive many emails from individuals requesting offers for products that do not even exist. For example, many people will say that they have a buyer for JP54 or D6 Diesel, whereas no such commodities actually exist.
JP54 is essentially a broker slang for aviation kerosene, also referred to as technical kerosene used in turbine driven aircraft. Aviation kerosene referenced as JP54 in reality is Jet A, a less commonly used aviation fuel vs Jet A1 or TS-1 the Russian grade of technical kerosene. No one produces aviation jet fuel JP54. All refineries, around the world, produce Jet A-1, USGC Jet 54, TS-1 (Russia + CIS) only. 99 % of all offers mentioning aviation jet fuel / kerosene referenced as JP54 are fake.
D6 is Residual Fuel Oil and is of a high-viscosity state. Fuel Oil #6 requires pre-heating to 220-260 degrees Fahrenheit in order to be utilized. Since Fuel Oil #6 requires pre-heating, it cannot be used in small ships or boats or cars. However, large ships and power plants utilize residual fuel oil. There is an incredible amount of fraud associated with Fuel Oil #6 (so called D6) and to avoid obvious risk, we deal direct and avoid broker chains.
D2 is another broker term for Gasoil also known as diesel fuel. Gasoil / diesel fuel grades are based upon the amount or sulfur content. The common grades of sulfur content in diesel fuel include US grade ULSD, Russian grade GOST 305.82, EU grade EN590, 50 PPM low sulfur grade and a standard sulfur grade known as 500 PPM often used for off road use.
We expect you to have knowledge about incoterms, BGs, PBs, LCs and other payment instruments, LOIs, ICPOs, what purpose these documents serve and who can actually issue these documents if at all (Not all documents you come across with stamps and signatures are worth it).
We can supply directly from many Asian, Middle Eastern and other refineries. Most refineries do not sell on CIF/CFR basis and don't issue 2% PB and need detailed Information from the end buyer. Some refineries need KYC from the end buyer, to move ahead. They do not issue corporate offers on a piece of paper upfront in any case. Cangem will perform extensive due diligence on the prospect, sometimes in-house, sometimes external.
In simple words, if you approach Cangem with stories of buyers and sellers that want commodities you don't even have proper knowledge about, we will not entertain.
99% of deals which have a low fixed price are false, are simply scams and there is no product available. A real seller will in almost all the cases only sell with a discount off a real based price for example AG Platts. The deals which sell for a fixed price are mostly spot deals and they have a time window of a few days. Within this time, they are normally sold, however, it happens sometimes that an amateur broker gets access to it and starts forwarding the offer all around the world for months and months after the deal has already been closed. The brokers will insist that the offer is genuine with no idea that commodities have already been sold and delivered months ago.
In any real offer there will never be a huge discount or huge commissions to intermediaries . It NEVER happens. So when you see a huge discount and/or huge commissions to intermediaries, it is more than likely that the deal is fake.
Most of the times, a real seller would never offer "real products" to a broker that cannot even spend a few thousand dollars on a website and uses a gmail, yahoo, hotmail or other free email id, has no verifiable office address and has no or very little online presence. The real seller would call a reputed and responsible multinational like Cangem Global and sell directly through them.
When an offer starts off with keywords like "Please send pictures, past performance first, LOI to End Seller (no proper seller name), need to sign IMFPA first, We know the seller/buyer through uncle/friend/relative, cannot disclose the seller" you should immediately understand that this means that they don't know the end seller/end buyer or if there is any, they are just forwarding the mail that they got from another broker who in turn got it from yet another broker. They have not done any due diligence even if they know a company who they think is the principal.
Cangem suggests you learn the language, and please do not send us the kinds of offers or inquiries that starts off with the above mentioned criteria. Please just purge them or put them straight into a trash can, which is exactly what we would do.
Cangem only works with those who are willing to put their ego aside. We do not have time to stroke anyone’s ego. We at Cangem Global expect you to respect our corporate policies, our employees, time constraints (do not expect a reply or call on Saturdays and Sundays from our Canada office, Sundays from our India office and Fridays from our Dubai office). We expect you to follow the proper procedure and respect the terms and conditions of our principals. If you do not agree, please email us in a professional way.
Do not ask for past performance documents, it is not only unprofessional but also unlawful because almost all the time, the non disclosure clause protect the SPAs and as such no company should forward documents related to a completely different client and transaction. Also, past performance does not guarantee future performance.
We expect you to do proper due diligence before forwarding us any document or inquiry. As brokers, facilitators and traders, we feel that it is our corporate responsibility to do proper homework before forwarding anything to our principals.
In a nutshell, we can work with you if:
1. You have knowledge of the commodity.
2. You are direct with the end buyer/seller.
3. You are willing to exchange principal's details.
4. You have performed proper due diligence.
Read more about our Corporate Policies