Hereinafter the “Code”
1. Introduction
1.1. At Internet Solutions, LLC, (hereinafter also referred to as the “Buyer”) the safety and quality of the goods that are produced with the use OZON Intellectual Property are of prime importance for us and are the foundation for our consumers and customers’ trust and loyalty to the Buyer and to goods bearing OZON Intellectual Property, and we expect our suppliers to share our commitment.
These requirements for suppliers/ were developed by the Buyer after analyzing and evaluating industry standards, goods defects, quality audit results at manufacturing sites, as well as after studying the cases of goods returns on the OZON marketplace (www.ozon.ru). Such analysis and evaluation have helped us determine which programs, when properly implemented, help prevent goods returns, consumer complaints, and manufacture goods of proper quality.
1.2. The terms and definitions used in the Code shall have the meaning given to them in the Code, unless a different meaning is given to them in the contract entered into by and between the Buyer and the Supplier which contains a reference to these Code (hereinafter referred to as the “Contract”).
1.3. Each manufacturing site where goods with the use OZON Intellectual Property are produced should comply with the requirements set out in this Code.
These requirements do not exclude or substitute applicable laws or regulations.
The requirements set forth by this Code shall apply in addition to the requirements set forth by the Contract.
In the event of any discrepancies:
- between this Code and the Contract or
- between this Code and other appendices to the Contract,
the provisions of the Contract or of the relevant appendices shall prevail.
1.4. The Buyer is entitled to make unilateral changes to the Code. The new version of the Code shall be published on the website and shall enter into force and apply to the relations between the Parties without the signing of an additional agreement to the Contract.
The Buyer shall notify the Supplier of any changes to the Code at least 15 working days before the changes come into force. The notification may be sent by e-mail to the address specified in the Contract.
The Buyer shall be entitled to correct technical and typing errors in the Code without notifying the Supplier.
2. Approval of manufacturing sites. Audits
All manufacturing sites (owned by the Supplier as well as those owned by the third parties) where the goods with the use OZON Intellectual Property are manufactured, as well as organizations engaged in storage, and/or additional operations with goods with the use OZON Intellectual Property (hereinafter referred to as “Manufacturing Sites”) should be approved by the Buyer.
The Buyer reserves the right to have audits of Supplier as well as of the Manufacturing Sites conducted either by the Buyer’s own employees or by a third party. Notice of the Buyer’s intention to conduct an audit should be sent beforehand. However, in special circumstances, the Buyer may also conduct unannounced audits.
In the event when as a result of the audit of the Supplier and/or of the Manufacturing Site shall be revealed any non-compliance with the requirements of this Contract, this Code and/or with the results of audits provided by the Supplier, the Supplier shall reimburse the Buyer for all documentarily confirmed expenses for audit, as well as any Additional expenses of the Buyer (if incurred).
3. Quality requirements
All Manufacturing Sites should have a documented quality system, including:
(a) an available organizational chart, quality policy, quality manual;
(b) the quality policy should be reflected, among other things, in annual quality targets with appropriate indicators.
Quality targets/indicators should be analyzed by the management of the company owning or operating the Manufacturing Site at least annually and communicated internally.
Responsibilities and authorities in the field of quality management should be clearly determined, including:
а) job descriptions for the staff;
b) for each position that performs quality functions, a substitute should be determined.
Storage of documentation, records and samples of Goods should be carried out by the Supplier:
- during the goods’ shelf life + 1 year.
Manufacturing changes:
The Supplier should notify the Buyer of its intention to make any changes that may affect the safety, quality and technical parameters of the goods (changes in the goods composition, new raw materials, new manufacturing line, the Manufacturing Site or new technical processes). Any change should be agreed with the Buyer, in writing, prior to their introduction. The Buyer reserves the right to evaluate whether an audit is necessary to approve such changes.
4. Incident and crisis management
Each Supplier should establish, document, implement and maintain (including the Manufacturing Sites) a program to identify, alert and respond to potential or actual incidents and crises.
(a) This program should provide a prompt, accurate and adequate response to incidents that may occur, including goods returns, using an identification and traceability system;
(b) Each Manufacturing Site should have a person responsible for managing incidents and crises;
(c) The effectiveness of the incident and crisis management process should be tested annually, including analyzing and evaluating the relevance of the list of internal and external contact persons.
5. Goods returns
The Supplier as well as all Manufacturing Sites should have a documented goods return procedure that ensures prompt and efficient response to goods incidents that pose an unacceptable risk to the Buyer and/or consumers.
The return procedure should include:
(a) Notification procedures, including lists of contact persons and customers contact details;
(b) Protocols for return and disposal of all goods affected by an incident, specifying authorities and responsibilities for ensuring the full return of goods;
(c) Determining locations, dates and quantities of the goods affected by an incident that have been delivered to the supply chain or directly to customers;
(d) Record of segregation of goods and/or materials affected by an incident and still being under the control of the Supplier/ the Manufacturing Site.
The recall and return system should be tested annually.
6. Good manufacturing practices
The Supplier’s company as well as all Manufacturing Sites should implement good manufacturing practices that ensure that goods are handled and stored in appropriate sanitary conditions, and that proper personal hygiene and health of the staff are maintained.
Buildings and structures should be designed, constructed and maintained in a manner that corresponds to the nature of the manufacturing process and does not pose a risk to the goods:
(a) that are structurally compliant with requirements (strong construction, good drainage system and no roof leaks), there is enough space to carry out production operations;
(b) Buildings and structures should be maintained in an appropriate condition, their boundaries should be clearly defined;
(c) Roads, yards and parking lots should have water discharges/drains;
(d) Structural elements, including floors, should be strong, with no damages, cracks, holes, openings or other shortcomings that may result in pest infiltration, generation of microflora, contamination of goods;
(e) The walls and floors of the production area should be washable or easy to clean;
(f) A waste management system should be developed and implemented to prevent contamination of goods or production areas;
(g) The Supplier and the Manufacturing Sites should implement a program for safe engineering support and utility supply in the area where goods are manufactured and handled. They include ambient air, compressed air, water and steam. The Supplier and the Manufacturing Site should control the access points to the aforementioned utility systems, as well as heating and ventilation systems.
Printed materials management: destroying or recycling materials bearing logotype and/or other trademarks and/or other Intellectual Property of the Buyer:
(a) The Supplier should maintain a procedure to ensure that any rejected, discarded or recycled materials (including industrial waste) containing any symbols, names, trademarks, logotype, the Design of the Goods or any other OZON Intellectual Property cannot be reused;
(b) The Supplier should have a documented process for destruction, disposal and recycling of materials (including packing materials). When this is done by a third party, the responsibilities and methods for ensuring the destruction of the materials should be specified in the relevant contracts, including verification of such destruction.
The Supplier and the Manufacturing Sites should implement and document a pest management program to effectively monitor and control pests on and around the site.
7. Manufacture
Procedures for designing and developing of new goods should be put in place to ensure that safe and legally compliant goods with set quality parameters are produced.
Technical specifications for the goods should agreed with the Buyer in writing before the manufacturing process starts.
A process for approval and formal confirmation by the Buyer of the concept and designs of the final goods should be implemented by the Supplier.
The Supplier should ensure that up-to-date versions of specifications agreed with the Buyer are available and used at the Manufacturing Sites, and ensure that relevant staff members have access to the same. Goods and manufacturing processes should comply with the following requirements:
(a) The Supplier should only supply goods that fully comply with the specifications agreed with the Buyer;
(b) If it is assumed by the Supplier that the requirements to goods agreed with the Buyer may not be met, then Supplier must immediately notify the Buyer of it.
The Supplier should guarantee effective quality assurance at all manufacturing stages of goods.
The Supplier should analyze the manufacturing processes (including, where applicable, the printing processes) to determine steps that are critical to the quality of final goods. For each such stage, technological parameters/equipment settings (manufacturing process specification) should be determined and documented.
Regular quality checks should be carried out by the Supplier to confirm that finished goods are within the tolerances specified in an agreed goods specification.
Where packing of the goods is printed, the Supplier and the Manufacturing Sites should have measures in place to ensure that the printed information is legible and correct and that it conforms to the Buyer’s specifications and applicable legal and Contract’s requirements.
8. Storage and transportation
The facilities used for the storage of ingredients, packing and goods must comply with at least good warehousing practices:
(a) the condition of warehoused goods should be assessed at regular intervals to detect contamination, tampering, theft, damage, unsanitary conditions, etc.
(b) Access to the facilities where goods and packing materials are stored and to external storage facilities should be limited to authorized staff members only;
(c) An efficient FIFO (first in, first out) or FEFO (first-ended first-out) system should be implemented for all materials or goods stored for the Buyer;
(d) Products or materials that have a strong odor should be segregated to avoid cross-contamination;
(e) Pallets, racks and equipment should be in good condition to prevent any physical damage to materials or products (e.g. no protruding nails, chipped wood, etc.).
9. Supplier evaluation program
The procurement of materials should be controlled by the Supplier to ensure that only counterparties that are capable of meeting the agreed requirements are used, including but not limited to:
(a) the Supplier should develop and implement a counterparty approval procedure for all counterparties supplying ingredients and/or packing used in the manufacture of goods for the Buyer;
(b) A list of approved counterparties should be made available to the Buyer at the Buyer’s first notice;
(c) The Supplier should have a procedure for regular evaluation of the counterparty ’s level of conformity.
10. Internal audits
The Supplier and the Manufacturing Sites should have a program of internal quality audits to be used for continuous improvements of the goods’ quality and of manufacturing process.
11. Complaint management
The Supplier should have a plan and system in place for effective collection, recording, investigation and management of goods complaints, incidents, withdrawals and recalls to ensure that all potential risks to goods quality and compliance to the requirements of the Contract and of the applicable legislation are controlled.