University Of East Anglia

Norwich Law School

LAW- M593

POSTGRADUATE LEGAL SKILLS

AND RESEARCH
PG COURSEWORK 2009-2010

STUDENT REGISTRATION NUMBER [4230531]

The need for a truly harmonised commercial law is urgent

Discuss.

WORD COUNT 1000

1. Introduction
In the light of absence of world law or universal law, the need for harmonisation of law becomes a
matter of importance. Because of the rapid growing of international trade as well as the advent of
mixed economies, the desire to unify the substantive commercial law has been increased . However
it has been alleged that harmonisation of law may turn sour. This essay will examine the benefits and
drawbacks of harmonisation of law in the context of recognition to what extend harmonisation is
urgent. In order to draw a fairly detailed picture of the urgency of the harmonisation law, firstly I will
provide a brief overview of the nature of harmonisation of law including definition and instruments.
Then I will overview the advantage and disadvantage of harmonisation of law from different points
of view. After that I will proceed to evaluate whether the harmonisation of law should be
internationally adopted .
2. Nature of Harmonisation
2.1. Definition
It is may be difficult to define the term harmonisation. In essence, the root of the word
'Harmonisation' is 'harmonise' which according to Cambridge Advanced Learner's Dictionary means
to be suitable together, or to make different people, plans, situations, etc. suitable for each other. In
legal terms the harmonisation of commercial law can be defined as an international process aim at
achieving uniformity in law which in turn reduce the conflict of law in international trade. In order to
achieve this goal, harmonisation process rests on four essential instruments.
2.2. The Instruments of International Law Harmonization
It has to be conceded that the international commercial law has experienced a dramatic transition at
the beginning of the twentieth century. This transition contributes in creating a wide spectrum of
international instruments (irrespective whether this variety is positive or negative). The instruments
of international harmonisation can be classified according to their degree of binding, into four
distinct groups; international instruments intended to become legally binding such as international
uniform commercial law conventions; facultative instruments such as model law (in French, loitype); contractually incorporated non-binding rules, promulgated by international organisations such
as international trade terms (INCOTERM); legislative guide such as UNIFROIT guide to
international Master Franchies Arrangements (2002) . These instruments are playing critical role in
facilitating international trade through filing the legal vacuum that parties may confront as a result
of the nature of international trade.
2

3. Benefits and Drawbacks of The Harmonisation of Commercial Law.

While some scholars approve of harmonisation of law, others have been more critical. They question
whether harmonisation of law is necessary and argue about the disadvantages entailed. Paul B.
Stephan believes that harmonisation of law has proved futile for many reasons. He perceives that
harmonisation of law provides a high degree of certainty which reflects negatively on international
trade. Many parties (he alleged) would favour flexibility over certainty, through looking for lenient
or ambiguous contracts instead of fettered or superfluous detailed contracts. He also maintains that in
the way toward harmonisation and unification law, optimal rules, which domestically improved by
local expertise, may be jettisoned, as the price of international harmonisation of law.
No less scathingly, Loukas Mistelis alleged that the harmonisation of law through conventions has
many pitfalls. It is not just the length of the harmonisation process including the ratification
mechanism, but also the high cost of the process. He claims that owing to sensitive issues arisen in
the context of international trade law such as sovereignty and prerogatives besides, natural
asymmetry between the participating countries, the conventions spawns may be less than expected .
Nevertheless, It is generally recognised that unification of international commercial laws has its
merits .
By virtue of harmonised commercial law, the expenses associated with international trade
transactions have been reduced. The nature of international trade law entails considerable number of
risks. Parties are bound to be concerned about the applicable law and jurisdiction in case things go
wrong. Also they bear in mind issues such as mandatory law, government interference etc. These
inherent risks in turn leading to increasing the expenses of international trade transactions.
Harmonised law play permanent role in reducing these risks as well as its associated expenses.
Furthermore , because of the nature of harmonised law process which involves many different
countries, besides expertise from all over the world , international harmonisation of commercial law
is not just provides a compatible neutral law but also takes a part in comprising legal frame work
which seems to be tailored to business community's needs. In addition, harmonised law is very
likely to be a contributing factor in protecting fledgling parties from falling prey to Opportunism and
hostility of some practitioners, thanks to the high level of certainty and clarity provided by
harmonised law.

5. Conclusion
This essay has briefly shown the feasible advantages and disadvantages of harmonisation of
commercial law with a brief overview of ''harmonisation'' definition and instruments . To sum up
briefly, The urgency of harmonisation is evident in reducing a considerable number of inherent risks
vis-a-vis international trade which emerged in parallel with the Buoyancy of international trade . In
addition, harmonisation of law is almost certain to be a key factor in filling the existent legal vacuum
through producing a significant proportion of neutral, compatible and tailor-made commercial law.
Yet, the Criticisms raised above may denote that the harmonisation of law is no absolute virtue.
There are Many factors that ought to be taken into consideration when harmonised law is produces
,ratified and applied.

BIBLIOGRAPHY :
1. Goode, R., Kronke, H,s,. Mckendric, E., and Jeffrey Wool Transnational Commercial
Law Text, Cases and Materials (OUP, April 2007)
2. Paul B. Stephan, The Futility of Unification and Harmonization in International
Commercial Law (University of Virginia School of Law, June 1999)
3. Loukas Mistelis, Is Harmonisation a Necessary Evil?( Sweet & Maxwell 2001)
4. William C. Burton, Burton's Legal Thesaurus(U.S 2007 )4th Ed
5. Alastair Mullis, A Typical International Trade Transaction ( University of East Anglia
2009 )
6. Roy Goode, Reflection on the harmonisation of Commercial law ( OUP 1990 )