Transcript International Trade Law Lecture 1: International

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International Trade Law
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E-mail: [email protected]
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Place: Via Ercole I d’Este 37, class 6
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Cell: 333-2059733
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Lezioni: Tuesday and Thursday
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Question hour: Tuesday 13.00-14.00
(after class, same room)
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Time: 11.00-13.00
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Requirement: commercial law ”
Crediti: 6
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Course Website:
Internal Trade Law (in lingua inglese)
http://www.unife.it/giurisprudenza/giuri
sprudenza/studiare/International%20Tr
ade%20Law%20%28in%20lingua%20i
nglese%29%20
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•Obligatory literature ITL
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- I.Carr., International Trade Law, fourth edition., Routledge-Cavendih (buy at
webstore, one book in library for consultation).
- Texts of International commercial instruments can be downloaded from internet
(links are provided) or from the course website.
Website ITL
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- Communication will be through ITL website. Consult
it frequently.
- The site provides, a.o:
- various announcements (modifications in day and time classes etc..)
- Course schedule of classes (days, themes, type of class);
- Reader contains list of material to be studied each class;
- Additional obligatory literature, other texts/documents or material to be studied for
seminar assignments.
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International Trade Law
CISG 1980(Lecture 3)
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Prof.ssa M.E. de Leeuw, Ph.D., Dr., Università di Ferrara
Main trading partners for exports, EU-27, 2011
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Main
trading partners for imports, EU-27, 2011
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Source: WTO
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The
Vienna
Convention
on
the
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International sale of goods 1980 (CISG)
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When?
Into force since 1988; 80 countries are party to the Convention, among which
China and USA (UK has not ratified for number of reasons).
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What?
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CISG provides for a single set of rules in respect of international sale of goodsexcluded certain aspects of a sale.
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Why?
Harmonisation would enhance predictability and legal certainty for traders.
Uncertainty about applicable domestic law (which varies among states) leads to
uncertainty about duties/obligation of parties.
UNICITRAL
Characteristics of CISG
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Not based on any specific national legal system. Compromise acceptable
to all regardless of eco/legal background;
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Avoid legal jargon, use of normal language to enhance accessibility;
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Source of inspiration for what can be deemed as international
acknowledged principles in the field of commercial law, often referred as
lex mercatoria;
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Influenced various domestic sales laws and international (regional)
laws/instruments, such as UNIDROIT and PECL, the EU directive on
aspects of sales of consumer goods, Draft common frame of reference
(european civil code)…
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Cisg applies more often through applicable national law of a country that
has ratified the CISG than by use of choice of law clause.
Scope of application (I)
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Scope (Article 1):
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The Convention applies to a sale if the parties have their place of business in
different states (which constitutes hence an “international” sale);
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and either both of those states are Contracting states or the rules of PIL lead to the law
of a Contracting state; and,
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Both parties know that they have places of business in different states (art. 1(2));
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Outside Scope (Art. 2):
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For purpose of the sale (goods bought for personal, family and household use),
the nature of the sale (sale by auction, on execution or otherwise by law), the
nature of the goods (stocks, shares, investment securities, negotiable
instruments, money, ships, vessels and hovercraft or aircraft, electricity).
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(in general procedural law is outside its scope)
Scope of application (II)
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The Convention is concerned with the formation of the contract and the
rights and duties of the buyer and seller arising from such
a contract (art. 4).
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Subjects excluded are the validity of the contract, the effects the
contract may have on the property in the goods sold, liability of the seller
for death or personal injury caused by the goods to any person (art. 4,5).
Party autonomy
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Opt-out (art. 6):
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International private law of most (developed) states recognise the principle of
party autonomy in international commercial transactions: choice of law.
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The party may exclude the application of the Convention entirely, or derogate
from or variate any of its provisions.
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Exclusion can be done explicitly or with the choice of law clause (e.g. apply
English law, not a party to CISG), or agreeing terms that contradict the
Convention (not mandatory).
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Case: party chooses the law of a country which is a party to the Convention: Is
the contract subject to the Vienna Convention or domestic law? Predominant
view in literature, reference to national law of (contracting) country includes the
Vienna Convention. (refer exclusively to domestic law without Convention)
Interpretation of
Contract and Convention
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Contract (art. 9):
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Trade usage may be binding on the parties: Usage agreed on by parties,
practices they have established between themselves, and usages of which
the parties knew or ought to have known of the usage, that the usage is
widely known in international trade, and that the usage is regularly
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observed. Trade usage does not include “custom”.
Convention (art. 7):
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Interpretation: “In the interpretation of this Convention, regard is to be had
to its international character and to the need to promote uniformity in its
application and the observance of good faith in international trade”.
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Problem: reluctance by courts to refer to opinions from other jurisdictions (case
law in databases), interpret from their domestic legal background.
How
can
autonomous
construction
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be achieved?
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Court be aware that when it is constructing a provision of
uniform law, he is performing an international function (it should
assume the attitude of a supranational court);
1.
This attitude means that the uniform instruments should be
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construed according to the wording (textual), intention
(teleological) and background (history), whereby the system of the
instrument should be taken into account.
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No priority between different methods.
2.
No solution courts should consider foreign cases. Courts should
follow the prevailing point of view in foreign cases.
3.
National construction (ultimate remedy)
Formation of contract (I)
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Part II (art. 14-24)
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No formal requirement of form of contract (art. 11), except when
Contracting Party has made art. 96 reservation (mandatory, party not optout);
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A proposal constitutes an offer when (art. 14(1):
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1.
it is addressed to a specific person(s);
2.
is sufficiently definite (it must indicate the goods and fix the quantity and price
explicitly or implicitly); and,
3.
indicates the intention on the offeror’s part to be bound in the event of
acceptance.
Offer becomes effective upon receipt.
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General rule: revocable
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Offer may be revoked, but the revocation has to reach the offeree before he
has dispatched an acceptance (art. 16.1);
Irrevocable:
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An offer cannot be revoked if it indicates that it is irrevocable, for example by
stating a fixed time for acceptance or otherwise (art. 16.2(a)).
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An offer cannot be revoked either when it was reasonable for the offeree to rely
on the offer as being irrevocable and the offeree has acted in reliance on the
offer (art. 16.2(b)).
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Acceptance:
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Assent or action required (art. 18(2)-(3)). Acceptance can be withdrawn (art.
22)
Counter-offer
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Rule of materially or not materially alterations (art. 19);
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Materially alterations are listed in art. 19(3) (inexhaustive list)
Obligations of the seller
Art: 31-44
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1.
Deliver the goods, hand over the documents and transfer
property in the goods (art. 30), as required by the contract;
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If contract not stipulates when, where and how the seller must perform
the obligations, the Convention provides supplementary rules (art. 3134).
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2.
Deliver the goods which are of the quantity, quality and
description required by the contract and which are
contained/packaged in the manner required by the contract
(art. 35).
3.
Deliver them without any right or claim of a third party (art.
41/42).
Liability of the seller
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 The
seller is liable for the lack of conformity (art. 35(2) and
36); The seller may however remedy any deficiencies
regarding quantity and quality of the goods till the date of
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delivery (art. 37);
 The
buyer needs to inspect the goods and give notice (within
reasonable time) of any lack of non conformity (art. 38/39).
Obligations of the buyer
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Art. 53-60
1.
The buyer must pay the price and take delivery of the goods as required
by the contract (art. 53, art. 60);
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If no price is concluded in the contract, or place and date of payment, the
Convention provides supplementary rules on how to calculate the price, and
where and when the payment needs to be made (art. 54-59).
Remedies in general
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Starting point of Convention: preservation of the contract,
enable performance by parties;
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If conditions are fulfilled, the aggrieved party may require:
performance, claim damages or avoid the contract. Buyer
may also reduce the price.
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Art. 25 defines fundamental breach, element are:
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Detriment, Substantially and Forseeability.
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Remedies in general
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Declaration of avoidance (art. 49, art. 64);
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When there is a fundamental breach;
2.
In case of non-delivery by the seller or non-payment of the price or
failure to take delivery by the buyer, the party in breach fails to perform
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within a reasonable period of time fixed by the aggrieved party.
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Certain remedies may be restricted by special circumstances.
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Fixing an additional period of time for performance by the
other party, buyer or seller (art. 47/63);
Remedies for seller
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Art.62-65
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Fixing additional period of time of reasonable lenght to fix
performance- seller precluded from resort to any remedy for
breach of contract in this period, unless he received notice of
buyer that he will not perform (art. 63);
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Declare the contract avoided (art. 64);
Remedies for buyer
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Art. 45-52
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Art. 46: performance:
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Buyer may require performance of the seller’s obligations ;
Buyer may require delivery of substitute goods only when the goods
delivered where not in confomity with the contract and the lack of
conformity constituted a fundamental breach; notice required (art. 39)
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at time of request or reasonable time;
Buyer may require repair; notice required.
Art. 47: fix additional time for performance;
Art. 48: seller may, after the date for delivery, remedy at his
own expense (conditions); request acceptance of buyer.
Remedies for buyer
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Art. 45-52
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Art. 49: declare contract avoided
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Art. 50: buyer may reduce price when goods do not conform
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Art. 51: partial delivery or part of goods conforms buyer may
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invoke remedies art. 46-59.
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Art. 52: delivery before date fixed: buyer may take or refuse
delivery; greater amount of goods delivered: buyer may take
or refuse extra amount