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India- not signatory member. reluctant - convention incomplete & not comprehensive treaty.
validity of contract like fraud, illegality, or misrepresentation related to contract. 1. Ambiguous
language: wide & inexact language = legal uncertainty 2. Damages regime: diff from ICA- governing
law for contracts in India. compatibility with Indian law. 3. Domestic laws: well-developed legal
framework - CISG not necessary arguments for ratification: 1. Indian law -Sale of Goods Act, 1930 -
British -very old & outdated. 2. modern means of transport, communication & techniques -changed
modes of entering into contract, 1930 Act not suitable 3. gap-filling nature 4. overcomes problem of
choice of law. difficulty in coping up with unfamiliar foreign law.
Formation: GATT, precursor to World Trade Organization (WTO), was established in 1947 following
Bretton Woods Conference. Its primary goal was to promote intl trade & reduce trade barriers in
aftermath of World War II.
Rounds: GATT conducted multiple rounds of negotiations, including Kennedy Round (1964-1967) &
Uruguay Round (1986-1994). These rounds aimed to lower tariffs, remove trade restrictions, &
address various trade-related issues.
Structure: Contracting Parties: GATT was initially signed by 23 countries, & its membership grew
over years. It operated on consensus-based system, with decisions made collectively by its member
states.
WTO
Formation : WTO was established on January 1, 1995, succeeding GATT. decision to create WTO was
made during Uruguay Round negotiations.
Principles:
The WTO's principles & agreements encompass trade in goods, svs, & intellectual property. It
provides comprehensive framework for managing intl trade & addressing trade-related issues. WTO
& GATT, have played vital role in promoting global trade, reducing trade barriers, & creating rules-
based system that fosters economic growth & cooperation among member countries. These
institutions continue to shape principles & rules governing intl trade.
Accession to WTO: Terms of Accession were to be ratified by all countries within 30 days of signing
that included the GATT, GATS and TRIPS as the prerequisite to signing as a member of WTO
1. GATT: provides a legal and institutional framework for regulating and facilitating international
trade of goods
2. GATS: It focuses on the regulation and facilitation of international trade of services and is based
on the core principle of non-discrimination, MFN and national treatment. expansion of services
trade through progressive liberalisation and increasingly transparent and predictable rules and
regulations.
3. TRIPS: It is a major prerequisite to WTO that focuses on the IPR (form of rights conferred upon a
product of invention or creation by a country’s legal system) and applied principle of
nondiscrimination to IP. It sets out obligations for members on the basis of adherence to copyrights,
patents, GI tags, trademarks etc. It imposes SR costs to reap LR gains.
a) The TRIPS Agreement sets down minimum standards, which allows members to provide
more extensive protection of intellectual property if they so wish. Members are left free
to determine the appropriate method of implementing the provisions of the Agreement
within their own legal system and practice.
1. DSM Procedure: The agreement emphasizes that prompt settlement is essential if the WTO is to
function effectively. It sets out in considerable detail the procedures and the timetable to be
followed in resolving disputes.
a) procedure for settling disputes existed under the old GATT, but it had no fixed timetables,
rulings were easier to block, and many cases dragged on for a long time inconclusively.
b) The approximate periods for each stage of a dispute settlement procedure are target
figures — the agreement is flexible. In addition, the countries can settle their dispute
themselves at any stage.
60 days-Consultations, mediation, etc
45 days-Panel set up and panellists appointed
6 months-Final panel report to parties
3 weeks-Final panel report to WTO members
60 days-Dispute Settlement Body adopts report (if no appeal)
Total = 1 year -(without appeal)
60-90 days -Appeals report
30 days-Dispute Settlement Body adopts appeals report
Total = 1y 3m(with appeal)
i. If it fails to act within this period, it has to enter into negotiations with the
complainant country (or countries) in order to determine mutually-acceptable
compensation — for instance, tariff reductions in areas of particular interest to the
complaining side
** Can add Case Studies here, putting all WTO case studies after Conclusion**
Evaluation of WTO:
Since the WTO came into being in 1995, the world has witnessed massive changes, some deeply
structural in nature. New technologies have transformed the way we live, communicate, and trade.
In 1995, less than 0.8 per cent of the world’s population used the internet; in June 2019 it was
around 57 per cent.
a) 4x trade in goods, decrease in import tariffs by 15% => growth of trade>>growth of world
GDP
--> WTO regulates 98% of world trade
2. Current Scenario:
The rules-based multilateral trading system is facing unprecedented strain.
--> The unpredictable and belligerent trade policy actions of the current US administration,
inflicted on adversaries and allies alike, have been met with retaliation and legal challenge at the
WTO.
--> Regardless of their outcome, new and ongoing adjudication over “national security”
justifications for trade measures and China’s status as a “market economy” will only risk further
destabilizing the trading system.
--> The escalation by Trump’s administration reflects its skepticism about multilateralism in general
and binding dispute settlement in particular, and its deep suspicion that global trade rules are
increasingly stacked against US interests.
--> growing strategic competition for economic dominance between the United States and China
a) The stalemate in the Dispute Settlement Body (DSB) over the appointment of new
members of the Appellate Body is just one more symptom of crisis at the WTO.
--> The immediate cause is the US refusal to join consensus to launch the appointment
process.
b) Restoring the WTO dispute settlement function= solutions to much more than just the
procedure used to extend Appellate Body members beyond the end of their terms.
i. Other WTO members countered past US reform efforts with an often equally dogmatic
insistence on their own vision of dispute settlement. Their frustration with the current
US administration’s erratic trade policy and suspicion of its ultimate intentions make
cooperation more difficult than ever.
ii. time is on the side of the United States. The more incapacitated the system becomes,
the more significant the reforms will likely need to be in order to reach agreement to
restore it.
Conclusion
The WTO's principles and agreements encompass trade in goods, services, and intellectual property.
It provides a comprehensive framework for managing international trade and addressing trade
related issues. The WTO and GATT, have played a vital role in promoting global trade, reducing trade
barriers, and creating a rules-based system that fosters economic growth and cooperation among
member countries. These institutions continue to shape the principles and rules governing
international trade.
5. Role of UNCITRAL
UN Commission on ITL - subsidiary body of General Assembly. role -improving legal framework for
intl trade by preparing intl legislative texts for use by States in modernizing law of intl trade & non-
legislative texts for use by comm parties in negotiating transactions. legislative texts address intl
sale of goods; intl comm dispute resolution (arbitration & conciliation), intl transport of goods; intl
payments; procurement & security interests. Non-legislative texts : rules for conduct of arbitration
& conciliation proceedings; & legal guides on industrial construction contracts & countertrade.
Reasons for establishment in 1966: Dramatic expansion of world trade -> Need for uniform rules
for intl trade -> Trade creates wealth -> essential to economic stability -> Promotes world peace -->
Facilitate Intl Trade through: - Coordination of work of organizations in ITL - Preparation of
Conventions & Model Laws & ensuring their uniform interpretation - Collection & dissemination of
info on developments in ITL Role: [1] Harmonization: & unify ITL + comm law =>reduce legal
barriers & disparities => EOB in CBT. Promoting legislative work through: [A] Conventions:
agreement establishing binding obligations upon States that ratify it. Ex- UN Convention on CISG:
model law - uniform set of rules for intl sales contracts = consistent contract law st&ards. [B] Model
Law: model legislative provisions States can adopt by enacting it into national law. Ex- UNCITRAL
Model Law on Intl Comm Arbitration: framework for conduct of intl arbitration. [C] Legislative
guide: for development of laws, relevant policy issues & choices & providing legislative solutions. Ex-
UNCITRAL Model Law on Electronic Commerce: legal framework for electronic
transactions(signatures & contracts). [D] Recommendations: for use of UNCITRAL instrument. [E]
Contractual rules: St&ard clauses to be included in comm contracts. [F] Legal guides: for drafting
contracts & recommending solutions to particular issues. [2] promoting uniform application &
interpretation of trade instruments [A] tech Assistance to LDCs: help them modernize comm laws &
institutions. technical & capacity-building programs on reforming LDC comm laws & procedures.
providing expertise, training, & guidance on implementation of UNCITRAL instruments. [3]
cooperation with UN & non-UN organizations- ex- UNCITRAL collaborates with WTO to ensure
consistency & coherence of intl trade rules, including those related to tis & trade facilitation. [4]
Facilitation of Intl Comm Dispute Resolution: promotes alt dispute resolution mechanisms (intl
comm arbitration) – provide businesses effective means of resolving cross-border disputes outside
traditional court system.
significant role in facilitating intl trade & inv - framework for legal certainty, predictability, &
fairness in comm transactions - reducing legal obstacles to CBT & econ growth & development.
limitations:
2. UNCITRAL's model laws & conventions are not binding on member states & require national
adoption, leading to disparities in implementation.
3. UNCITRAL has no direct enforcement authority, relying on state adherence to its guidelines
4. Differing interpretations of UNCITRAL texts in national courts can hinder legal uniformity. &
limited inclusivity =some countries may not be involved in UNCITRAL, resulting in gaps in
harmonization efforts.
5. challenges in addressing rapidly evolving areas of intl trade, like digital commerce. Cultural,
legal, & economic differences among member states can hinder harmonization efforts.
Structure: Elected by UNGA for 6 years- Every 3 years terms of half members expires=>
representation 6 Working Groups within UNCITRAL => development of diff texts to modernize &
harmonize: ITL I. Procurement II. Arbitration & Conciliation III. Online Dispute Resolution IV.
Electronic Commerce V. Insolvency Law VI. Security Interests
7. Council for tis under TRIPOD
Council for Tis - component of WTO, overseeing implementation & functioning of GATS. GATS - to
regulate intl tis. Tis more than 20% of total world trade. GATS—Uruguay Round-1st time svs brought
into MTA but negotiations difficult as tis is intangible. Defn- tis as occurring in: Mode 1: CBT- Mode
of supply that does not require physical movement of producers or consumers Ex- India- medical
transcript svs to US hospitals via satellite tech Mode 2: Movement of consumers - travels to country
of producer Ex- tourism Mode 3: FDI - require comm presence by producers in country of consumers
Ex- financial svs Mode 4: Movement of natural persons - Non-comm presence by producers - Ex-
consulting, construction Aim of GATS- ↑ tis - liberalisation = transparent & predictable rules +
members’ interests on mutually advantageous basis + balance of rights & obligations - respect
members’ right to regulate supply of svs within their territories - meet national policy objectives + ↑
LDCs tis GATS Principles- [A]MFN: Treat all nations as you would treat your MFN: favour one, favour
all [B]National Treatment: Treat imped svs providers as you treat your local = svs
providers[C]Transparency: publication/notification of measures affecting tis; to WTO; response to
inquiries from other WTO members; Notification to WTO if members not complying Functions-1.
Supervision & Monitoring: primary function of Council - oversee implementation of GATS
commitments by WTO countries-reviewing schedules of commitments Ex- extent to open up svs
sectors- finance & ed to foreign svs providers. 2. Negotiations: platform to liberalize tis= expansion of
commitments, ↑market access & better conditions for foreign svs providers.
For instance, countries negotiate to reduce restrictions in foreign markets. 3. Dispute Settlement:
if 1 country believes that another has violated its GATS obligations, bring dispute to WTO resolution,
Council play role in facilitating discussion. 4. Transparency & Information Sharing: forum to share
info on svs regulations & trade policies -more predictable & conducive 5. Technical Assistance &
Capacity Building: programs to help LDC implement & benefit from GATS provisions. Conclusion;
Council for Tis operating within WTO framework, ensures commitments under GATS, negotiations for
liberalization, & addressing issues. limitations of GATS: 1. less binding commitments = limited market
access svs sectors. 2. not address certain svs sectors comprehensively, leaving gap 3. GATS criticized
for complexity 4 "modes" of svs supply Many LDC find difficult to access Mode 4 = GATS does not
adequately address their labor exp interests. 5. Resistance from number of developing countries due
to biased representation – US EU
Parties entering into intl sales contracts should be aware of these issues & consider how they might
affect their transactions. They may also choose to explicitly address these concerns in their
contracts, including choosing diff governing law or specifying dispute resolution mechanisms.
ICC stands for the International Chamber of Commerce. It is an influential global business
organization that provides a platform for businesses and other stakeholders to address international
trade issues, establish common standards, and advocate for policies that facilitate and regulate
international commerce. The International Chamber of Commerce (ICC) plays a pivotal role in
promoting fair trade globally. The ICC's expansive membership across more than 130 countries lends
it substantial international influence
Origin
The ICC's roots trace back to the aftermath of World War I when the need for a global system of rules
governing trade, investment, and commercial relations became evident. This historical context
highlights the organization's commitment to promoting peace through commerce. Known as the
"merchants of peace," the ICC was founded in 1919, and its impact on international trade has been
profound.
Goal
The ICC's mission is succinctly encapsulated in its goal to "make business work for everyone, every
day, everywhere." This mission reflects the organization's dedication to promoting international
trade and investment as vehicles for inclusive growth and prosperity. The ICC aims to harness the
power of global commerce to uplift millions out of poverty while emphasizing inclusivity and
sustainable growth.
Role
ICC has three main activities – rule setting, arbitration and policy advocacy – and provides essential
services such as ICC Arbitration, training, commercial crime fighting and customs facilitation.
Rule Setting: The ICC's rule-setting activities are crucial in harmonizing and standardizing trade
practices. The widely recognized Incoterms rules, which facilitate global trade by standardizing terms
and transactions, are a prime example. These rules help reduce misunderstandings and disputes,
promoting fair trade.
The ICC, through its rules and guidelines, provides a framework for international trade
contracts, including the Uniform Customs and Practice for Documentary Credits (UCP) and
the Incoterms rules. These rules often contain provisions related to the discharge of contract,
particularly in the context of international trade and payment mechanisms like letters of
credit.
International Court of Arbitration (ICC Court) is a preeminent global institution for the
resolution of international commercial disputes through arbitration. Established as part of
the International Chamber of Commerce (ICC) in 1923, the ICC Court plays a pivotal role in
promoting fair trade globally.
Arbitration is a method of alternative dispute resolution (ADR) used to settle conflicts and
disputes outside of the traditional court system. It involves the parties in dispute submitting
their case to one or more arbitrators who, acting as neutral third parties, make a binding
decision on the matter. The ICC Court administers international arbitration proceedings,
helping parties resolve commercial disputes outside of national court systems. It ensures
that arbitration is conducted in a neutral, efficient, and enforceable manner.
Promotion of Fair Trade: Impartial and Expert Resolution: The ICC Court offers a neutral and
expert forum for resolving disputes. This impartiality contributes to fairness in trade by
ensuring that disputes are resolved based on the facts and applicable law, rather than being
influenced by the legal systems of a specific country.
Enforcement of Awards: The ICC Court's awards are recognized and enforceable in many
countries through international conventions like the New York Convention. This ensures that
parties can rely on the arbitration process to uphold their rights and obligations, thereby
promoting fair trade.
Transparency and Efficiency: The ICC Court's procedures are designed to be transparent,
efficient, and flexible. This helps expedite dispute resolution, which is crucial for maintaining
trust and fairness in trade relationships.
Policy Advocacy: The ICC actively engages with governments and international organizations to
influence trade policies and regulations. It leverages its extensive network to advocate for policies
that foster fair, efficient, and ethical trade practices. By addressing issues relevant to the business
world through commissions and task forces, the ICC contributes to the creation of a predictable and
transparent global trade environment.
Cross-Border Dispute Resolution: International trade often involves parties from different
countries with varying legal systems. The ICC Court's services bridge the gap by providing a
mechanism for settling disputes that is recognized and accepted globally.
Cross-Industry Expertise: The ICC Court has experience handling disputes across various
industries, from banking and finance to construction and intellectual property. This broad
expertise contributes to the fair and informed resolution of trade disputes.
Global Reach: The ICC Court operates worldwide, making it accessible to businesses engaged
in global trade. This reach ensures that businesses can benefit from its dispute resolution
services in various regions.
And after the uruguay round, WTO was established to supervise and liberalize trade. Adoption of
TRIPS is a compulsory requirement of World Trade Organization membership.
IPRs - the rights given to persons over the creations of their minds. They usually give the creator an
exclusive right over the use of his/her creation, for a certain period of time. TRIPS Agreement sets
down minimum standards, which allows members to provide more extensive protection of
intellectual property if they so wish. Members are left free to determine the appropriate method of
implementing the provisions of the Agreement within their own legal system and practice.
Objectives of IPRs :
To encourage and reward creative work, To protect investments in the development of technology, To
stimulate and ensure fair competition, To protect consumer choices, To facilitate transfer of
technology in the form of FDI, joint ventures and licensing, To achieve the balance of rights and
obligations.
TRIPS Agreement adds a substantial number of additional obligations on matters where the
pre-existing conventions are silent or were seen as being inadequate. The TRIPS Agreement
is thus, sometimes referred to as the “BERNE and PARIS-PLUS AGREEMENT”.
ENFORCEMENT
The second main set of provisions deals with domestic procedures and remedies for the
enforcement of intellectual property rights. The Agreement lays down certain general
principles applicable to all IPR enforcement procedures. In addition, it contains provisions on
civil and administrative procedures and remedies, provisional measures, special
requirements related to border measures and criminal procedures, which specify, in a
certain amount of detail, the procedures and remedies that must be available so that right
holders can effectively enforce their rights.
DISPUTE SETTLEMENT
The Agreement makes disputes between WTO Members With respect to the TRIPS
obligations subject to the WTO's dispute settlement procedures.
Further, the Agreement provides for certain basic principles, such as national and most-
favoured-nation treatment, and some general rules to ensure that procedural difficulties in
acquiring or maintaining IPRs do not nullify the substantive benefits that should flow from
the Agreement.
Conclusion
significance of the TRIPS Agreement lies in its role as a global framework for intellectual property
protection that balances the interests of rights holders and the public. It plays a central role in
facilitating trade in knowledge and creativity, in resolving trade disputes over IP, and in assuring WTO
members the latitude to achieve their domestic policy objectives. However, the agreement continues
to be a subject of debate and negotiation, particularly concerning its impact on developing countries.
critical appraisal
One of the critical issues surrounding TRIPs is the existing disparity in IP ownership between
developed and developing countries. Developed nations predominantly hold most of the world's IP,
while developing countries have fewer IP protections. This imbalance can raise the costs of many
goods and services for developing countries, amounting to a wealth transfer from consumers in
these countries to producers in developed nations. This raises questions about the fairness and
equity of the agreement.
The obligations placed on developing countries to align with TRIPs often come with transition
periods. While this recognizes the challenges these nations face, it also means that in the short to
medium term, welfare gains may be absent. This has led some economists in developing countries to
view TRIPs as a welfare-worsening, "non-trade" agenda item that might not belong within the WTO
framework.
Allows for greater transition periods for developing countries for the six obligations
Lacks efficiency gains that characterize trade and restricts freedom of countries to choose intellectual
property regime that is best for them.
its impact on public health, particularly in the context of access to essential medicines like AIDS
drugs. The requirement to honor international patents on AIDS drugs can result in exorbitant prices,
making these life-saving treatments unaffordable for patients in many developing countries. This
situation can lead to higher mortality rates due to AIDS, illustrating the human cost of the
agreement.
proponents argue that TRIPs may lead to increased foreign direct investment (FDI) and technology
transfer, potentially boosting domestic innovation. In this view, TRIPs imposes short-term costs with
the hope of generating long-term benefits.
The significance of TRIPs lies in its potential to promote innovation and protect IP, but the extent to
which it achieves this while ensuring equitable access to essential products remains a subject of
ongoing debate and scrutiny.
In the context of the TRIPS Agreement, national treatment means that foreign holders of intellectual
property rights must receive the same legal protections and rights as domestic holders of those
rights. It ensures that foreigners are not discriminated against concerning IPR protection in the host
country.
In the context of TRIPS, MFN treatment requires that the level of IPR protection and the treatment of
IPR holders from one member country should be extended to all other member countries. This
ensures that if a member grants certain rights or benefits to one country regarding IPR protection, it
must offer the same to all other member countries.
While US had started conceptualizing about an international trade organization in 1945, General
Agreement on Tariffs and Trade, a multilateral agreement regulating international trade, was
established in 1947. It was created as a response to the economic challenges and trade barriers that
emerged after World War II. The primary purpose of GATT was to promote international trade by
reducing or eliminating trade barriers, such as tariffs and quotas. It aimed to create a more
predictable and stable trading environment.
GATT encouraged member countries to "bind" their tariffs. Binding tariffs meant that a country
agreed not to raise its tariffs above a certain negotiated level. This provided predictability and
stability for international trade because other member countries could rely on these maximum tariff
rates.
GATT principles
The MFN principle was a core element of GATT. It required that any trade concessions or benefits
granted to one member country should be extended to all member countries. This principle aimed to
ensure that no country would receive preferential treatment over others. For example, if one country
reduced tariffs on a particular product for one trading partner, it had to extend the same tariff
reduction to all its trading partners (most-favored-nation treatment).
GATT negotiations were often based on the principle of reciprocity. This meant that countries would
agree to lower their tariffs in exchange for equivalent concessions from their trading partners.
Reciprocity was a key mechanism for balancing the benefits of tariff reductions among countries.
As GATT progressed through different rounds of negotiations, tariff levels decreased, and more
products and sectors became subject to reduced tariffs. These rounds aimed to address different
aspects of trade and focused on specific issues like agriculture, textiles, and services, in addition to
general tariff reduction.
GATT not only focused on tariffs but also sought to address non-tariff barriers to trade, such as
quotas and licensing requirements. These barriers could restrict trade as effectively as tariffs, and
GATT negotiations aimed to reduce or eliminate them.
The agreement also recognised that there are circumstances in which strict adherence to these
principles would be inappropriate.
Conclusion -
Tariff reductions have been the mainstay under the GATT. The average tariff levels for major GATT
participants were about 22% in 1947, but dropped to 5% after the Uruguay Rounds in 1994.
Uniformity, standardisation and common platform for deliberations amongst nations are other claims
to fame. However, there still being many areas of commercial transactions that required to be
addressed, GATT had to pave the way for the WTO
Critical appraisal-
Rounds reduced tariffs among member countries in many (but not all) sectors
Average tariff on manufactured products imposed by industrial countries fell from 35%
(highest) to 4%
However the GATT Secretariat could not always effectively enforce negotiated agreements
without legal standing of the ITO
Resolved in 1994 with Marrakesh Agreement, Provided for creation of World Trade
Organization
GATT was based on several key principles, including the most-favored-nation (MFN) principle, which
meant that any trade concession or advantage granted to one member country should be extended
to all member countries. It also emphasized the principle of non-discrimination.
GATT operated through a series of negotiation rounds. The most famous of these rounds was the
Uruguay Round, which concluded in 1994 and led to the establishment of the World Trade
Organization (WTO).
The WTO is the successor to the GATT, and the original GATT text(GATT1947) is still in effect under
the WTO framework, subject to the modifications of GATT 1994.
Introduction :
As general rule parties to contract have an intention towards the fulfillment of their part and in case
of breach, party breaching is liable to compensate for the same. But an exception to this rule is laid
down in Section 56 of the Indian contract act 1872. Section 56 deals with the doctrine of
frustration. This doctrine allows a contract to be deemed void when unforeseeable events make it
impossible to perform the contract And the promisor is relieved of any liability under the contract.
Section 56 is based on the maxim “ les non cogit ad impossibilia” which means that the law will not
compel a man to do what he cannot possibly perform.
the term ‘frustration’ means “feeling of being annoyed on not achieving something you wished”. In
terms of contract, it is a situation that makes the performance of a contract impossible without any
fault of the parties in the contract, the contract becomes frustrated.
two impossibilities:
It speaks about two impossibilities i.e. Initial impossibility and Subsequent Impossibility. Initial
impossibility undergirds the fundamental proposition that ‘’An agreement to do something that is
intrinsically impossible is void’’. For example, an agreement to bring a person back to life who is
dead, being impossible of performance, is void. Subsequent Impossibility as the term suggests
something that happens later, i.e. after the parties have got into a contract. An example here would
be where a contract is made for the import of goods, and the import is thereafter forbidden by a
Government Order.
Frustrating events :
Supervening illegality:
Performance of the contract becomes impossible in the manner and the time contemplated
ensuing from the change in circumstance. If the legislature passes law after the contract is
constructed to deal with the changed situation, which makes the contract frustrated.
Ex- A, a company in India dealing with exports and imports of dry fruits. A gets into an
agreement with B, a supplier of dry fruits in Pakistan. Subsequently, war breaks out between
India and Pakistan, as a result, the legislature passes a law, thereby making the imports from
Pakistan illegal, the contract is frustrated by supervening illegality.
Force majeure :
Force majeure is a clause in contracts that addresses unforeseeable circumstances preventing
contract performance. It refers to extraordinary events or circumstances beyond the control of the
parties involved that make it difficult or impossible for them to fulfill their contractual obligations.
These events are typically considered acts of nature or "acts of God," but force majeure clauses in
contracts can also encompass a broader range of unforeseen and uncontrollable events. It talks
about supervening impossibility.
While force majeure has neither been defined nor specifically dealt with, in Indian statutes, some
reference can be found in Section 32 of the Indian Contract Act, 1872 (the "Contract Act") envisages
that if a contract is contingent on the happening of an event which event becomes impossible, then
the contract becomes void.
Common examples of force majeure events can include natural disasters (e.g., earthquakes,
hurricanes, floods), war or acts of terrorism, government actions (e.g., changes in regulations,
embargoes), labor strikes, epidemics or pandemics (e.g., the COVID-19 pandemic), and other events
that are considered beyond the reasonable control of the parties.
Force majeure clauses can usually be found in various contracts such as power purchase agreements,
supply contracts, manufacturing contracts, distribution agreements, project finance agreements,
agreements between real estate developers and home buyers, etc.
Conditions to remember
Force majeure clause must be explicitly expressed in your contract to avail justice in court.
The impossibility must be absolute and not merely difficult or onerous.
The event causing impossibility must be beyond the control of the parties.
In cases of supervening impossibility, if the contract is partially performed, the party who has
received some benefit from the partial performance must compensate the other party to the
extent of the benefit received.
Conclusion :
In all these scenarios, supervening impossibility relieves the parties of their contractual obligations
because it becomes genuinely impossible to fulfill the contract due to unforeseen events or factors
beyond their control. This doctrine protects parties from being held liable for circumstances they
could not have anticipated.
Although Parties must take prompt steps to mitigate the occurrence and impact of any such event,
this can include making a FOB or CIF contract favourable for buyer, or getting an insurance cover in
case of shipping overseas, re-routing of ships in case of war conditions or accidents, include
healthcare clause if you are trading via an epidemic prone route.
10. Functional Heads under the ICC and the role they play.
Formation:
1. World Council: The highest governing body comprises representatives from national
committees and elects key officers, including the Chairman and Vice-Chairman.
2. Executive Board: Comprising up to 30 business leaders and ex-officio members, it shapes
ICC's strategic direction, implementing its policies.
3. International Secretariat: Based in Paris, it is the operational arm of the ICC, working on its
programs and representing business interests in international organizations. The Secretary-
General, appointed by the World Council, leads this body.
4. National Committees: ICC structures established by member nations to represent business
interests. In countries without a national committee, direct membership is available to
companies and organizations.
5. Finance Committee: Advises the Executive Board on financial matters, prepares budgets, and
supervises financial implications of ICC activities.
1. Dispute Resolution Services: The ICC administers various dispute resolution services,
including arbitration, mediation, dispute boards, expertise, and DOCDEX. The International
Court of Arbitration is a key component, handling thousands of cases. International Court of
Arbitration provides a trusted platform for resolving international business disputes. This
institution offers a neutral and efficient mechanism for settling conflicts, thereby ensuring
the fair treatment of parties in global trade relationships. Accessible to non-members as
well, ICC's dispute resolution services are instrumental in maintaining trust in global trade.
2. Policy and Business Practices: ICC develops policies, rules, and standards through specialized
working bodies. These are adopted by commissions in consultation with national committees
and then approved by the Executive Board. Commissions, task forces, and other structures
facilitate this process.
3. ICC Commercial Crime Services (CCS): CCS operates from London, focusing on combating
commercial crime. It comprises specialized divisions like the International Maritime Bureau,
Financial Investigation Bureau, Counterfeiting Intelligence Bureau, and Fraud Net.
The ICC plays a pivotal role in global trade by crafting voluntary but widely observed rules and
standards. Its leadership, including the Chairman, Vice-Chairman, and Secretary-General, steer the
organization's efforts. The Executive Board ensures the implementation of strategic priorities. The
ICC's International Court of Arbitration, part of its dispute resolution services, helps in resolving
international business disputes effectively, and its CCS combats commercial crime on multiple fronts.
Overall, the ICC's multifaceted activities significantly impact international business and trade.
keeping the UN convention on CISG as your reference point, explain how contracts are formed
and can also get frustrated (doctrine of frustration)
ChatGPT
UN Convention on (CISG) is an international treaty that governs contracts for the sale of goods
between parties located in different countries. It provides a framework for the formation,
performance, and frustration of international sales contracts. In the context of CISG, let's explore
how contracts are formed and how they can get frustrated:
1. Offer and Acceptance: The formation of a contract under CISG typically begins with an
offer made by one party (the offeror) and the acceptance of that offer by the other party
(the offeree). The offer and acceptance must indicate the parties' intent to be bound by
the contract.
2. Intention to be Bound: Both parties must have a genuine intention to enter into a
contract. This is a fundamental principle under CISG. The terms of the contract must be
clear, or at least determinable, and the offer must specify essential terms such as the
quantity of goods, price, and delivery terms.
3. Communication of Acceptance: In international trade, acceptance can be
communicated in various ways, including by traditional means like email or through the
conduct of the parties. CISG allows for flexibility in how acceptance is communicated.
It's important to note that the application of the doctrine of frustration can be complex and may
depend on the specific facts of each case. It is advisable for parties involved in international sales
contracts governed by CISG to seek legal counsel when faced with situations that could lead to
the frustration of the contract. Additionally, contractual clauses regarding force majeure or
hardship may be included to address these issues proactively.
explain the biographical facets of the ICC (origin, organs, functions) and write a detailed note on
the 'rules of arbitration' as enlisted by this world body on commerce.
ChatGPT
The International Chamber of Commerce (ICC) is a global business organization that plays a
crucial role in facilitating international trade and commerce. It has a rich history, a set of key
organs, and functions aimed at promoting a smooth and fair international business environment.
Origin: The ICC was founded in 1919 in the aftermath of World War I. Its creation was driven by
the need to establish a system of rules governing international trade, investments, and
commercial relations. It was established as a response to the call for international cooperation
and peace through commerce. The ICC is headquartered in Paris, France.
Key Organs: The ICC comprises several key organs that oversee its operations:
1. World Council: The highest governing body of the ICC, composed of members from
around the world. The World Council sets the organization's policies and objectives.
2. International Secretariat: Responsible for the daily operations and administration of the
ICC. It ensures that the ICC's various functions run smoothly and efficiently.
3. International Court of Arbitration: This is a prominent organ responsible for resolving
international commercial disputes through arbitration. It administers arbitration
procedures and manages cases under ICC arbitration rules.
4. Bureau: The Bureau is responsible for implementing ICC policies and decisions between
World Council meetings. It includes key figures in international business.
Functions: The ICC serves several important functions in the realm of international business:
1. Rule-Making: The ICC is known for its role in developing rules and standards that
facilitate international trade, such as the Uniform Customs and Practice for Documentary
Credits (UCP), Incoterms, and ICC Arbitration Rules.
2. Dispute Resolution: The International Court of Arbitration plays a critical role in
resolving international commercial disputes through arbitration, providing a neutral and
efficient mechanism for dispute resolution.
3. Policy Advocacy: The ICC actively engages with governments and international
organizations to advocate for policies that promote fair, efficient, and ethical trade
practices. It leverages its extensive network to address issues relevant to the business
world.
4. Trade Promotion: The ICC promotes international trade and investment as vehicles for
inclusive growth and prosperity. It emphasizes the power of global commerce to uplift
millions out of poverty while focusing on inclusivity and sustainable growth.
Rules of Arbitration: The ICC has developed a set of rules that govern the arbitration process.
These rules are widely recognized and utilized for resolving international commercial disputes.
Here are some key aspects of the ICC Arbitration Rules:
1. Appointment of Arbitrators: The rules detail the process for selecting arbitrators,
ensuring their impartiality and independence.
2. Conduct of Proceedings: They provide guidelines on the conduct of arbitration
proceedings, including hearings, written submissions, and evidence presentation.
3. Interim and Conservatory Measures: The rules cover measures that may be taken to
preserve the rights of parties during the arbitration process.
4. Awards: The rules set out the requirements for rendering awards, including their form,
content, and the decision-making process by the tribunal.
5. Enforcement of Awards: Procedures for enforcing awards are outlined, and ICC awards
are generally enforceable under the New York Convention.
6. Costs: The rules establish the principles for allocating the costs of arbitration, including
administrative expenses, arbitrator fees, and legal costs.
7. Expedited Procedure: An expedited procedure is available for disputes of lower value,
promoting quicker and more cost-effective resolutions.
The ICC's arbitration rules are well-regarded for their clarity and effectiveness, making them a
preferred choice for businesses involved in international trade. The process adheres to the
principles of fairness, neutrality, and efficiency, and the awards are enforceable in many countries
worldwide. The ICC plays a crucial role in promoting fair, efficient, and impartial dispute
resolution in the international business community.
1. Governing Proceedings: The ICC Rules of Arbitration are the primary source for governing
arbitration proceedings conducted under the ICC's administration. They provide a comprehensive
framework for the conduct of arbitration proceedings, covering every stage from the initiation of
arbitration to the rendering of the final award.
2. Flexibility: The ICC Rules of Arbitration are known for their flexibility. They allow parties to
adapt the proceedings to their specific needs while ensuring fundamental principles of fairness
and due process. The rules enable parties to design their arbitration process to fit the
complexities and specific requirements of their dispute.
3. Supplementing Rules: In cases where the ICC Rules do not address specific aspects of the
arbitration, parties and the arbitral tribunal are allowed to supplement the rules with additional
agreed-upon procedures or rules. This flexibility ensures that disputes are resolved effectively,
even when unique circumstances arise.
4. Consent Requirement: To benefit from ICC Arbitration, parties must have consented to its
use, either through a contract, treaty, or a separate arbitration agreement. Parties can include
arbitration clauses in their agreements before a dispute arises, providing for ICC Arbitration as
the chosen method for dispute resolution.
6. Enforcement of ICC Awards: ICC awards are highly enforceable globally due to the
international recognition of the ICC's credibility and neutrality. The organization strives to ensure
that awards rendered through ICC Arbitration are enforceable, making them more valuable and
effective for the parties involved.
7. Regular Updates: The ICC frequently updates its Rules of Arbitration to align them with
international best practices and emerging trends in arbitration. The rules are translated into
various languages, making them accessible to parties from different linguistic backgrounds and
legal systems.
8. Simplified and Adaptable Rules: The ICC Rules are designed to be short, adaptable, and
straightforward. They are drafted to be easily understood and applied in various types of
arbitration procedures. This simplicity ensures that the rules can be effectively utilized by parties
with diverse legal backgrounds and in different business contexts.
In conclusion, the ICC Rules of Arbitration provide a reliable and well-established framework for
conducting international arbitration proceedings. They emphasize flexibility, effectiveness, and
fairness while accommodating the specific needs of the parties involved. The ICC's experienced
administration and commitment to keeping the rules current ensure that ICC Arbitration remains
a preferred choice for resolving international commercial disputes.
the TRIPS agreement is the torchbearer to the ever evolving laws on IPR, world-over. Elucidate.
ChatGPT
The Trade-Related Aspects of Intellectual Property Rights (TRIPS) agreement is indeed a pivotal
international treaty that has had a profound impact on shaping the landscape of intellectual
property rights (IPR) laws worldwide. It represents a significant milestone in the evolution of IPR
laws and continues to influence the development of these laws across the globe. Here's an
elucidation of how TRIPS serves as the torchbearer to evolving IPR laws:
1. International Standardization of IPR Laws: TRIPS sets the foundation for establishing
minimum international standards for IPR protection and enforcement. It covers various
forms of intellectual property, including patents, copyrights, trademarks, and trade
secrets. This standardization ensures that member countries harmonize their domestic
IPR laws with the provisions of the agreement.
2. Promotion of Innovation and Creativity: By providing robust protection for intellectual
property, TRIPS encourages innovation, research, and the creation of new works. It
bolsters the incentive for individuals and entities to invest in developing new products,
technologies, and artistic works.
3. Balancing Interests: TRIPS strikes a balance between the interests of rights holders and
the broader public. It recognizes the need to protect IPR while allowing for certain
flexibilities to address public health concerns, promote technology transfer, and
safeguard access to essential medicines. The Doha Declaration reaffirmed this balance,
particularly concerning public health and access to medicines.
4. Global Enforcement Mechanism: TRIPS includes provisions for the enforcement of IPR
rights, offering legal remedies against infringement. This global enforcement mechanism
ensures that IPR owners can protect their rights across borders, promoting international
trade and investment.
5. Promotion of Technology Transfer: TRIPS emphasizes the importance of technology
transfer to help developing countries build their technological capacity. It encourages
developed countries to provide technical assistance and support to their less developed
counterparts.
6. Protection of Geographical Indications: TRIPS recognizes the protection of
geographical indications for products, providing safeguard against the misuse of regional
names and designations.
7. Updates and Amendments: TRIPS has evolved over time, with member countries
revising and updating their IPR laws to remain compliant with the agreement's
requirements. These updates demonstrate the dynamic nature of IPR laws and the need
to adapt to changing technologies and global trade dynamics.
8. Influence on Bilateral and Regional Agreements: The TRIPS agreement has served as a
template for many bilateral and regional trade agreements. As countries engage in trade
negotiations, they often incorporate TRIPS-like provisions, extending the influence of
TRIPS beyond its own membership.
9. Dispute Settlement Mechanism: TRIPS includes a dispute settlement mechanism
allowing member countries to bring disputes related to IPR violations to the World Trade
Organization (WTO). This process ensures that IPR issues are resolved consistently and
impartially.
In summary, the TRIPS agreement has played a central role in shaping the world's IPR landscape.
It serves as a model for IPR legislation in many countries, has provided a global framework for
harmonizing IPR laws, and continues to adapt to technological advancements and changing
international trade dynamics. As IPR issues become increasingly critical in the modern economy,
the TRIPS agreement remains a torchbearer guiding the development of IPR laws worldwide.
1. Scope of Application (Article 1): The CISG applies to contracts for the international sale
of goods, where both the seller and the buyer have their places of business in different
countries that are parties to the convention. It does not apply to domestic sales or
services contracts.
2. Exemptions (Article 2): The CISG does not apply to specific types of sales, including
auctions, sales of securities, ships, aircraft, and electricity. Additionally, it does not govern
the validity of the contract or the effect of the contract on the property in the goods.
3. Formation of Contract (Articles 14-24): The CISG outlines the rules for contract
formation, including offer and acceptance. It covers issues like the time and manner of
acceptance, communication of offers and acceptances, and the use of standard terms in
contracts.
4. Obligations of the Seller (Articles 30-44): The CISG defines the seller's obligations,
including the delivery of goods, conformity of goods with the contract, and the transfer
of property rights. It also addresses issues like the quality and quantity of goods,
packaging, and labeling.
5. Obligations of the Buyer (Articles 53-61): The CISG outlines the buyer's obligations,
which include payment of the price, inspection and acceptance of goods, and taking
delivery of the goods. The buyer is required to pay the price and take delivery of the
goods within the timeframe specified in the contract.
6. Passing of Risk (Articles 66-70): The CISG establishes rules for when the risk of loss or
damage to the goods passes from the seller to the buyer. These rules are crucial for
determining which party is responsible for the goods at various stages of the transaction.
7. Remedies for Breach of Contract (Articles 45-61): The CISG provides a range of
remedies for both the seller and the buyer in case of a breach of contract. These remedies
include the right to demand specific performance, the right to avoid the contract, the
right to claim damages, and the right to reduce the price of the goods.
8. Limitation Period for Claims (Article 39): The CISG establishes a two-year limitation
period for bringing claims for breach of contract, starting from the date the buyer
discovered or should have discovered the breach.
9. Exemption from Liability (Articles 79-80): The CISG recognizes that certain events
beyond the control of the parties, such as natural disasters or government actions, may
exempt a party from liability for a breach of contract.
10. Good Faith and Fair Dealing (Article 7): The CISG incorporates a general principle of
good faith and fair dealing, which parties must observe when negotiating and performing
their contractual obligations.
11. Reservations (Article 95): The CISG allows countries to make reservations to specific
provisions of the convention when they ratify it, which can modify the application of
certain rules in their international sales contracts.
12. Interpretation (Article 7): The CISG emphasizes the need for uniform interpretation and
application of its provisions, taking into account the international character of the
convention.
The CISG is a flexible framework that allows parties to adapt it to their specific needs, provided
they do not violate mandatory provisions of the convention. It provides an important legal basis
for international trade and helps to harmonize contract law principles across different legal
systems, promoting legal certainty in cross-border transactions.
STATE THE ORIGIN, ORGANS AND FUNCTIONS OF THE ICC AND WRITE A BRIEF NOTE ON THE
RULES OF ARBITRATION, AS ENLISTED BY THIS WORLD BODY ON COMMERCE.
ChatGPT
Origin of the ICC (International Chamber of Commerce):
The International Chamber of Commerce (ICC) was founded in 1919. It is one of the world's most
influential global business organizations. The ICC originated in the aftermath of World War I
when there was a need for a global system of rules governing trade, investment, and commercial
relations. The ICC has its headquarters in Paris, France, and operates as a non-governmental
organization (NGO).
The ICC has several organs and components, each with specific roles and functions:
1. World Council: The ICC's supreme governing body, consisting of business leaders from
around the world, who meet annually to set policies and strategies.
2. Executive Board: Responsible for the implementation of the policies and decisions made
by the World Council.
3. Secretariat: The ICC's administrative arm, which carries out day-to-day operations and
works closely with national committees.
4. National Committees: Operate in many countries and promote the ICC's mission and
objectives at the national level.
5. ICC Institute of World Business Law: Provides a platform for the development of the
ICC's global services in the field of international business law.
The ICC serves various functions and plays a pivotal role in the global business community:
1. Policy Advocacy: The ICC actively engages with governments and international
organizations to influence trade policies and regulations. It leverages its extensive
network to advocate for policies that foster fair, efficient, and ethical trade practices.
2. Rules and Standards: The ICC is known for its involvement in developing international
rules and standards that facilitate international trade. This includes the famous Incoterms
rules for international sales contracts.
3. Dispute Resolution: The ICC operates the International Court of Arbitration, a trusted
platform for resolving international business disputes through arbitration. This institution
offers a neutral and efficient mechanism for settling conflicts, thereby ensuring the fair
treatment of parties in global trade relationships.
4. Incoterms Rules: The ICC has created and maintains the Incoterms rules (short for
International Commercial Terms), which provide a common set of rules for international
trade. These rules define the responsibilities of buyers and sellers for the delivery of
goods under sales contracts. They are widely used to avoid misunderstandings in
international trade.
The ICC Rules of Arbitration are widely recognized and used in international commercial disputes.
These rules govern the conduct of arbitration proceedings when parties have agreed to resolve
their disputes through ICC arbitration. Key features of the ICC Rules of Arbitration include:
1. Appointment of Arbitrators: The ICC Court appoints arbitrators unless the parties have
agreed on a different method for appointing them.
2. Conduct of Proceedings: The ICC Rules set forth procedures for the conduct of
arbitration, including filing of claims and defenses, evidence presentation, and hearings.
3. Confidentiality: Arbitration proceedings under the ICC Rules are confidential, protecting
sensitive business information.
4. Award: The ICC Court reviews and approves the award rendered by the arbitrators,
ensuring its enforceability.
5. Enforcement: ICC awards are enforceable in many countries under international
conventions, such as the New York Convention.
6. Efficiency: The ICC Rules promote the efficient resolution of disputes, and arbitrators are
expected to issue awards promptly.
The ICC Rules of Arbitration contribute to the resolution of international commercial disputes in a
fair and impartial manner, which is essential for maintaining trust in global trade relationships.
WHAT DO YOU UNDERSTAND BY IPR? HOW HAS THE TRIPS AGREEMENT INFLUENCED THE
RECOGNITION AND INTERPRETATION OF THESE LAWS?
ChatGPT
Intellectual Property Rights (IPR): Intellectual Property Rights refer to legal protections granted
to the creators and owners of intellectual property. Intellectual property includes creations of the
mind, such as inventions, literary and artistic works, symbols, names, and images used in
commerce. IPR allows the creators and owners to control and benefit from their intellectual
creations, providing an incentive for innovation and creativity. Common forms of IPR include
patents, trademarks, copyrights, trade secrets, and industrial designs.
In summary, the TRIPS Agreement has played a central role in shaping the recognition and
interpretation of IPR worldwide. It has established a minimum set of standards and enforcement
mechanisms that member countries are required to follow, leading to greater global protection
for intellectual property rights. It has also provided a framework for addressing the balance
between protecting IPR and ensuring public access to essential goods, such as medicines.